At Summons we are lawyers specialising in mergers and acquisitions (M&A). We have extensive experience in both cross-border (with an international component) and domestic mergers and acquisitions.
In situations of business growth, the company's strategy may call for resources to expand the business (such as acquiring a competitor or supplier) or even to invest in new activities. This expansion can be done by means of an acquisition (mainly a purchase and sale of shares in a public limited company or shares in a private limited company) or a structural modification (merger or global transfer of assets and liabilities).
At Summons we are lawyers specialised in mergers and acquisitions; we advise on acquisition operations and structural modifications.
Our firm has lawyers specialised in M&A who accompany the client throughout the entire process; from the initial negotiation phase and review of the state of the business (due diligence) to the effective closing of the transaction (signing and closing), including post-closing follow-up.
The most commonly used mechanism in Spain for the acquisition of a business is the purchase and sale of shares in a public limited company (S.A.) or shares in a private limited company (S.L.).
The companies with the largest volume tend to be public limited companies. However, the most used company is the limited company. For the purchase and sale of shares, at Summons we provide advice at all stages of the process, including the preparation of the share purchase agreement in private documents. We also have experience in the purchase of shares by the company itself (treasury stock) and in the purchase and sale of shares between partners.
Our lawyers have consolidated experience in the sale and purchase of shares in public limited companies operating in multiple sectors of activity and in the sale and purchase of shares in smaller or family companies.
Moreover, we also specialise in asset sale and purchase transactions. In some cases, the buyer may prefer not to buy or sell shares, but only to acquire the assets of the business in which he or she is interested. We also advise on the acquisition of production units in insolvency proceedings and companies in crisis.
As an alternative to the acquisition of companies through the purchase and sale of shares in a public limited company or shares in a private limited company, there are the transactions regulated in Book One of Royal Decree-Law 5/2023 (Primer Libro del Real Decreto- ley 5/2023), which transposes Directive (EU) 2019/2121 of the European Parliament and of the Council of 27 November 2019.
Although the concept of company mergers is used generically, there are different types of structural modifications. At Summons we are lawyer specialists in all types of structural modifications (transformation, merger, spin-off and global transfer of assets and liabilities), including the following: transformation of a limited company into a public limited company, merger of commercial companies, merger of companies by absorption, improper merger of companies, spin-off of companies, partial spin-off of companies, segregation of companies, contribution of a branch of activity, etc.
In this type of company structural modification operations, we advise, among others, on the company merger project or any other type of structural modification, the deed of merger of companies, the convening and holding of meetings and the exercise of the rights of shareholders, creditors and employees.
Frequently Asked Questions (FAQ)
Mergers and acquisitions (M&A) are operations through which the ownership of a company is transferred. This transfer can be carried out mainly through (i) a structural modification under Royal Decree-Law 5/2023; or (ii) the acquisition of the business, either by purchase of shares or holdings in a company or by purchase of the assets that make up the business.
The most commonly used mechanism in Spain for the transfer of ownership of a business is the purchase and sale of shares in a public limited company or the purchase and sale of shares in a company.
In general terms, the transaction may begin with the signing of an agreement of intent which allows the buyer to carry out a due diligence process to ascertain the status of the business it intends to acquire.
Following this review, buyer and seller will negotiate the sale and purchase agreement in which they must ensure that all covenants and in particular the liability regime of both parties, including representations and warranties (R&W), are regulated.
If suspensive conditions are agreed after the signing of the private contract for the sale and purchase of shares, their fulfilment is necessary for the subsequent signing of the closing deed. If there are no such conditions, the signing of the private contract of sale of shares and the closing may take place at the same time.
Once the closing of the transaction has taken place, the transfer of the business will be effective and post-closing actions will have to be followed up.
In the case of the sale and purchase of company shares (S.L.), a notarial deed must be signed, as required by Article 106 of the Spanish Companies Act (Ley de Sociedades de Capital). However, it is customary to sign the purchase and sale of shares in a private document for subsequent notarisation.
For the purchase and sale of shares in a public limited company (S.A.), although a priori it is possible to do so without a public document, it is highly recommended that the closing of the transaction be carried out by signing a notarial deed. Likewise, it is common to carry out the sale and purchase of shares in a private document and then notarise it before a notary.
A merger is a structural modification whereby two or more registered commercial companies are integrated into a single one by means of the joint transfer of their assets and the attribution of shares, holdings or quotas in the resulting company to the shareholders of the companies being extinguished , which may be a newly created company or one of the merging companies (merger by absorption).
When a company is spun off, it divides its assets and liabilities by means of a structural modification operation.
In brief terms, there is (i) a total division, when the division of the assets into two or more parts leads to the extinction of the company being divided; and (ii) a partial division or segregation, when a part of the assets is separated and transferred to another company.
