Mergers and Acquisitions

Any transaction by which control or ownership of a business changes hands — a share acquisition, an asset or business purchase, a slump sale, an amalgamation or a court-sanctioned scheme. The commercial label matters far less than the legal structure chosen.

It depends on what the buyer actually wants: the company with all its history, or the business without it. A share purchase takes the entity and its liabilities; an asset or business purchase can leave defined liabilities behind. Tax, stamp duty, approvals and timeline all follow from that choice.

The transfer of an undertaking as a going concern for a lump-sum consideration without values being assigned to individual assets. It has its own tax treatment under Section 50B of the Income-tax Act.

Where the transaction is a merger, amalgamation or arrangement under Sections 230 to 232 of the Companies Act. A straightforward share purchase between willing parties does not need one.

Because a Tribunal-sanctioned scheme transfers the undertaking as a whole by operation of the order, including contracts and litigation, without individual assignments and consents. For a business with hundreds of contracts, that can be worth the delay.

A structured review of the target — corporate records, contracts, litigation, employment, property, intellectual property, regulatory standing, tax and compliance — to establish what the buyer is actually acquiring and what it should be protected against.

Rarely a single catastrophe. Usually a pattern: unsigned or expired contracts, change-of-control clauses that require counterparty consent, undocumented related-party dealings, unregistered charges, employment misclassification, IP that was never assigned by the people who created it, and statutory filings in arrears.

A contractual term allowing a counterparty to terminate or renegotiate if ownership of the company changes. In a share purchase these can quietly destroy the value being bought, and finding them is a core diligence objective.

Where the transaction is a combination crossing the prescribed thresholds and no exemption applies. The asset and turnover tests are the traditional route, and the deal value threshold introduced by the 2023 amendment adds another.

A transaction valued above two thousand crore rupees requires CCI approval where the target has substantial business operations in India. Importantly, the de minimis exemption for small targets does not rescue a transaction that crosses it — so a deal can be notifiable even where the target looks far too small on the old tests.

Implementing a notifiable combination before CCI approval. It carries penalty exposure, so where a filing is required the standstill obligation has to be respected — including in how the parties behave commercially before closing.

A route allowing deemed approval on filing for combinations with no horizontal, vertical or complementary overlaps, on self-assessment. It is fast, and the self-assessment has to be right.

Where the target is a listed company. Acquiring shares or voting rights above the prescribed threshold, or acquiring control, triggers an open offer obligation under the SAST Regulations, alongside disclosure requirements.

A deal generates unpublished price sensitive information from an early stage. Structured digital databases, trading window closures and confidentiality arrangements are compliance obligations, not optional good practice.

Wherever a non-resident is on either side — as buyer, seller or existing shareholder. Sectoral caps, the entry route, pricing guidelines and reporting in the prescribed forms all need to be addressed before the structure is fixed.

An RBI, SEBI, IRDAI or IFSCA regulated target brings change-in-control approval, fit-and-proper assessment of the incoming shareholders and directors, and often a long lead time. That approval frequently sets the deal timetable.

Statements by the seller about the target, breach of which gives the buyer a claim. They allocate risk for matters diligence could not fully resolve, and are the most negotiated part of most agreements.

A contractual promise to compensate for a specified loss, typically for known or identified risks found in diligence, often with its own limits and survival period separate from the warranties.

A portion of the consideration retained or held by a third party for a period, available to meet warranty or indemnity claims. It is the practical answer to a seller who may be hard to recover from after closing.

Things that must happen before closing — regulatory approvals, third-party consents, board and shareholder resolutions, release of security, and rectification of diligence findings. Managing them is most of the work between signing and closing.

Anything from weeks for a small private share purchase to many months where a scheme, CCI filing, sectoral approval or listed-company process is involved. The regulatory path, not the negotiation, usually sets the timetable.

A restriction on the seller competing with the business sold. Indian law restricts agreements in restraint of trade, with a recognised exception for the sale of goodwill within reasonable limits, so the drafting needs care.

It depends on the structure. In a share purchase employment continues with the same employer; in a business transfer, employee transfer, continuity of service and consent become live issues with statutory consequences.

Signing a term sheet that fixes price and structure before diligence has established what is being bought, and before anyone has mapped the approvals. Everything after that is renegotiation.

We handle structure comparison, due diligence, transaction documentation, regulatory mapping across CCI, SEBI, FEMA and sectoral regulators, conditions precedent management, closing and post-closing compliance. Appearance before any Tribunal is through advocates.