Mergers and acquisitions are transactions which transfer or consolidate the ownership of companies, or the operating units of companies, or business organizations. Legally speaking, a merger is the consolidation of two (2) business entities into one entity, whereas an acquisition occurs when one entity, or individual, takes ownership of another entity's ownership interest - whether by stock, assets, liabilities, or other equity interests. From an economic perspective, the difference between a merger and acquisition is less clear various control and ownership perspectives.
Davis Law advises businesses and individual owners during numerous types of mergers and acquisitions. We have supported the business community in negotiating M&A deals and drafting M&A documents; however, the majority of our expertise lies in the tax consequences of M&A transactions. M&A transactions can be categorizes into two (2) primary areas: Taxable M&A Transactions and Non-Taxable M&A Transactions. However, M&A transactions can also be categorized in Asset Sale versus Stock Sale Transactions, and Cash Sale versus Equity Interest Sale Transactions.
Davis Law can be reached at 404.901.2500 and 770.922.8500 to discuss your M&A transaction, or send us a message from our website - Contact Davis Law.
Useful M&A IRS Links:
Internal Revenue Code - 26 U.S. Code § 368
Internal Revenue Service Publication 537 - Installment Sales