Selling shares in a company is a common way to transfer ownership of a business in Ireland. Unlike an asset sale, where individual assets are sold, a share sale transfers the company itself including all its assets, contracts, employees, and liabilities to the buyer.
To protect both parties, the process generally follows five key steps.
- Negotiation & Heads of Terms – The main commercial terms are agreed and recorded in a non-binding document.
- Due Diligence – The buyer will generally review the company’s financial, legal, and tax position.
- Share Purchase Agreement (SPA) and Tax Deed – The SPA and Tax Deed is drafted with negotiations focussing on warranties, indemnities, and completion deliverables.
- Disclosure Letter – The seller formally makes disclosures against the standard warranties to be provided by way of a disclosure letter. This limits their liability on foot of the warranties to be provided.
- Completion – Consideration is paid, the shares are transferred, records are updated, companies registration office filings made and stamp duty is paid.
Early engagement with legal and tax advisors is best to ensure a smooth share sale process.
For more information please contact James Tansey or Niamh Gibney.
The content of this article is provided for information purposes only and does not constitute legal or other advice.
