TRANSACTIONS AND BUSINESS CHANGE
A business change should make sense before it becomes binding.
A company may be acquired, sold, restructured or opened to a new shareholder or investor. A family business may pass to the next generation. A group may be reorganised, a legal form changed or an activity transferred to another entity.
These are not isolated legal events. A transaction changes ownership, tax position, contracts, employment, financing, decision-making authority, intellectual property and the way the company will operate once the change has taken effect.
Pavan Geraedts brings the fiscal, juridical and coordinating parts of a transaction together. We examine the intended result, set out the available routes and their consequences, prepare and review the documents and keep the process connected from the first confidential conversation through to completion.
Our role is to make the change understandable and workable for the people who have to live with it. Where a civil-law notary, advocate, auditor or valuation specialist must act, we define the question and coordinate that work.
Contact us when:
- you are considering the purchase of a company, a shareholding or a business activity;
- you intend to sell the company or transfer it to a family member, a colleague or a successor;
- a new shareholder, investor or partner will join the company;
- the group structure or the legal form must change for commercial, fiscal or governance reasons;
- a merger, joint venture or lasting cooperation with another company is being discussed;
- a letter of intent, term sheet or draft agreement has been received and must be understood before it is signed;
- due diligence must be prepared, answered or reviewed;
- a transaction has been agreed and the completion steps and later changes must still be carried out.
WHY TRANSACTION SUPPORT MATTERS
The agreement
is only one part of the change.
A transaction is often discussed as a document. In practice the document records decisions that have already been taken about price, structure, timing, risk and responsibility. Those decisions determine what the company will own, what it will owe and what it will be able to do afterwards.
Support is therefore most valuable before the structure is fixed. It allows the parties to see the consequences of each route, to establish the facts on which the price and the warranties depend, and to keep the fiscal, corporate and contractual work moving in the same direction.
The result comes
before the structure
A transaction should begin with what the parties want to achieve: continuity, an exit, new capital, a simpler group or a clean separation. The structure is the means of reaching that result, and it can only be chosen sensibly once the result is clear.
The transaction form
changes the consequences
A share transfer, an asset or activity transfer, an issue of new shares, a merger and a conversion of legal form do not produce the same outcome. They differ in tax treatment, transfer of liabilities, consents required, employment consequences and the formal steps needed to complete them.
Information
shapes the decision
Price, warranties, indemnities and conditions all rest on facts about the company: its contracts, tax position, records, assets, staff, disputes and obligations. Where the facts stay unclear, the risk tends to be moved into the agreement rather than removed from the transaction.
Authority and approval
must be visible
A company can only be bound by those entitled to bind it. Shareholder resolutions, board approval, the articles of association, transfer restrictions, financing conditions and, in some cases, employee representation or third-party consent belong in the timetable rather than at the end of it.
Tax
belongs inside the decision
The fiscal consequences of a transaction are rarely a separate exercise. They influence the structure, the price, the financing, the distributions and the position of the shareholder as well as the company. Considering them late narrows the choices that remain available.
Completion
creates new work
Signing is not the end of the change. Registrations, notifications, amended agreements, new authority, banking, insurance, employment administration, intellectual property and reporting lines all follow from the transaction and need to be carried out in the right order.
WHAT Pavan Geraedts HELPS WITH
From the first decision to the company’s new operating position.
An engagement may concern one defined question, such as the review of a letter of intent or the fiscal consequences of a proposed structure. It may also cover the whole transaction, from the first confidential orientation through to completion and implementation.
We agree the scope at the beginning, together with the parties involved, the information required, the timetable and the points at which another professional must act. That keeps the work proportionate and makes clear what Pavan Geraedts will deliver.
01
Transaction orientation
and structure
We start with the intended result and the position of each party. From there we set out the routes available: a share transaction, an asset or activity transfer, an issue of new shares, a reorganisation, a merger or an arrangement staged over time.
Each route is described in terms of its consequences for tax, liabilities, contracts, employment, financing, governance and the formal steps required to complete it.
The outcome is a structure the client can explain and defend, and a sequence of decisions that can actually be carried out.
02
Fiscal analysis
and transaction tax
We advise on the Dutch tax consequences of the transaction for the company, for the shareholder and, where relevant, for the group.
This may include the treatment of a share or asset transfer, participation questions, the position of the director and shareholder, financing and interest, distributions before or after completion, transfer taxes, VAT on the transfer of an activity and the fiscal consequences of a reorganisation or a change of legal form.
Where another jurisdiction is involved, we define the Dutch position and identify where local advice is required.
03
Information, due diligence and disclosure
On the buying side we carry out a proportionate fiscal and juridical review of the company, its contracts, obligations, ownership, records and known risks, and translate the findings into questions of price, structure, conditions and protection.
On the selling side we help prepare the company for examination: assembling the relevant documents, identifying matters that need explanation and organising disclosure so that the answers are accurate and consistent.
The purpose of the review is to support a decision rather than to produce a volume of paper. Audit, technical and valuation work remains with the appropriate specialist.
04
Agreements
and transaction documents
We draft and review the documents through which the transaction is agreed and performed: confidentiality agreements, letters of intent and term sheets, share and asset purchase agreements, subscription and investment agreements, shareholders’ agreements, loan and security documents, escrow and earn-out provisions, transitional arrangements and completion documents.
The terms are tested against the commercial reality: what has been promised, what has been examined, who carries which risk, how the price is determined and adjusted and what happens if a warranty proves to be incorrect.
Notarial deeds and other reserved acts are executed by the civil-law notary. We coordinate that work and check that the deed matches the agreement.
05
Governance, approval
and negotiation support
We identify who must decide, approve or consent, and in which order: shareholders, directors, a supervisory board, co-shareholders under a transfer restriction, financiers, key counterparties and, where applicable, employee representation.
We prepare the resolutions and records that make each decision visible, and we support the negotiation itself with analysis, drafting and positions that can be explained to the other side.
Where the parties would rather reach their own agreement, business mediation can be a suitable route alongside or instead of adversarial negotiation.
06
Completion
and post-transaction change
We plan and follow the completion steps: conditions to be satisfied, the signing sequence, notarial execution, payment, share registration, Chamber of Commerce and tax filings and the transfer of authority.
After completion the company has to operate in its new position. That may involve amended articles of association, new mandates and banking authority, revised employment and pension administration, assignment or renegotiation of contracts, transfer of intellectual property and licences, insurance and internal reporting.
Define
BEFORE THE TRANSACTION FORM IS CHOSEN
Choose the route for its consequences, not its label.
Parties often arrive with a form already in mind: a share deal, an asset deal, a merger, a holding structure. The label matters far less than what the route does to tax, liabilities, contracts, staff, financing and the time the transaction will take.
The sequence below keeps the decision in the right order. It applies to a modest acquisition as much as to the reorganisation of a group.
Define
Establish the intended result, the parties, the value at stake, the timing and the constraints. Confirm who owns what today and who has to be involved in the decision.
Structure
Compare the available routes for their fiscal, contractual, employment, financing and governance consequences. Choose the route that reaches the intended result with consequences the parties can accept.
Verify
Establish the facts the transaction relies on through proportionate review and disclosure. Decide what is confirmed, what remains uncertain and how that uncertainty is priced, warranted or excluded.
Complete
Settle the documents, obtain the required approvals and consents, execute in the correct order and carry out the registrations, notifications and operational changes that follow.
WHEN TO INVOLVE Pavan Geraedts
Early enough for the advice to shape the decision.
There is no single correct moment, but the value of advice falls once a structure has been announced, a price has been agreed or a document has been signed.
The situations below are the points at which a conversation usually changes the outcome.
Planned
acquisition
You are considering buying a company, a shareholding or a business activity. We help you test the rationale, choose the structure, scope the review, set the conditions and understand what you would actually be acquiring.
Sale
or succession
You intend to sell the company or transfer it within the family or to a colleague. We help prepare the company and its documentation, structure the transfer, address the fiscal consequences for the shareholder and arrange the transition of responsibility.
New shareholder
or investor
Capital or a new partner is joining the company. We address the issue or transfer of shares, the price mechanics, the shareholders’ agreement, decision and information rights, dividend policy and what is to happen if a party later wishes to leave.
Reorganisation
or legal-form change
A holding structure, transfer of an activity, demerger, internal transfer or conversion of legal form is being considered. We examine the fiscal and juridical consequences together with the steps and approvals needed to implement them.
Merger, joint venture
or strategic cooperation
Two companies intend to combine or to work together on a lasting basis. We help define the contribution of each party, the governance, the ownership of results and the exit arrangements before the cooperation begins.
Completion
and implementation
A transaction has been agreed and now has to be performed. We coordinate the completion steps, the notarial and registration work and the operational changes the company needs in order to function in its new position.
HOW TRANSACTION SUPPORT STARTS
We begin in confidence, with the result you intend to reach.
A first conversation commits you to nothing. Most enquiries reach us while the change is still being considered, and confidentiality is the normal starting point.
We discuss the company, the parties, the intended result, the timing and anything already agreed or received. We then explain how we would approach the matter, what information is needed and which other professionals are likely to be involved.
The engagement sets out the scope, the responsibilities, the fee basis and the way we will report. Where a party is not yet able to disclose its identity or the details, we can begin with the structure and the fiscal consequences in general terms.
THE BASIC PROCESS
A route from intention to completion.
1
Confidential orientation
You describe what is expected to change. We consider whether the matter fits the practice, identify the principal fiscal and juridical questions and agree how to proceed.
2
Structure and information plan
We compare the available routes and their consequences, agree the intended structure and set out the information, documents and approvals the transaction will require.
3
Advice, documents and negotiation
We advise on the substance, prepare or review the agreements and supporting resolutions and support the negotiation and disclosure until the terms are settled.
4
Completion and transition
We coordinate the conditions, signing, notarial execution, payment and registrations, and set out the actions, owners and dates that apply after completion.
THE GOAL OF A WELL-MANAGED TRANSACTION
The company should understand its new position on the first day after completion.
A transaction has succeeded when the parties know what was agreed, why it was agreed in that form and what each of them must now do.
That is a matter of preparation rather than optimism. The three outcomes below are what we work towards in every engagement.
A decision
supported by facts
The structure, the price and the protections rest on information that has been examined, with the remaining uncertainty identified and consciously allocated rather than discovered afterwards.
An agreement that can be performed
The documents reflect what the parties intend, are consistent with the approvals given and can be signed and performed in the correct order.
A coherent new
operating position
Ownership, authority, contracts, tax position, registrations and administration all correspond to the transaction, so the company can operate normally instead of working around it.
CONNECTED AREAS OF THE PRACTICE
The transaction moves through the whole company.
A change of ownership or structure touches tax, contracts, governance, data, intellectual property and the working relationships between the people involved.
Pavan Geraedts can keep these questions connected within one engagement, so the company does not have to explain the same transaction repeatedly to separate advisers.
PROFESSIONAL SCOPE AND BOUNDARIES
Each professional conclusion must come from the right authority.
Pavan Geraedts provides fiscal advice, juridical advice, document drafting and transaction coordination within the agreed engagement. We are a boutique practice. We do not present ourselves as an investment bank, a corporate finance house, an accountancy transaction-services department or a large-firm mergers and acquisitions team.
What clients should understand
Pavan Geraedts does not provide investment advice, does not act as a broker or intermediary in the sale of a company and does not arrange or place financing.
We do not issue business valuations or fairness opinions. Where a valuation is required, it is obtained from a suitably qualified valuation specialist.
We do not perform statutory audits and do not provide an auditor’s opinion on accounts, forecasts or transaction figures.
Notarial deeds, including the transfer of shares in a Dutch private company and the execution of a merger, demerger or conversion, are prepared and executed by a civil-law notary.
Court proceedings and other reserved work remain with an advocate. We can define the question and coordinate that work.
A fiscal or juridical review reports on the matters examined within the agreed scope. It is not a statement that the company carries no risk or that nothing further exists.
Advice is based on the facts, documents and assumptions available at the time. A counterparty, tax authority, regulator or court may reach a different view.
The outcome of a negotiation cannot be guaranteed. What can be improved is the preparation, the structure and the documentation of the position.
Advice on foreign law or taxation is obtained from a suitably qualified professional in the relevant jurisdiction.
A completion date, condition or filing deadline becomes our responsibility only when Pavan Geraedts confirms it in writing.
These boundaries exist so that every conclusion carries the authority it needs. They also make clear which part of the transaction Pavan Geraedts will handle and at which point another professional has to act.
