South Florida Corporate Restructuring Through Merger & Acquisitions
When businesses want to expand their business or create a more powerful business entity, they may opt to combine their assets and resources with other companies. This is also known as leveraging which is based on the principle that the whole is greater than the sum of its parts.
This known practice called Merger & Acquisition is usually the best course of action taken by companies who want to improve their sales and financial capabilities or to expand their company at a faster rate. Although commonly regarded as joining two companies into a single business entity, “merger” and “acquisition” are two distinct terminologies. Both of them deal with business entities. However, the results arising from the deal will be of different nature.
If, for example, two separate business entities of the same size or two companies, which when combined creates an equal advantage for both, decide to merge as one, a “merger” will be most appropriate. This will result in the creation of a new business entity where both parties would benefit from each other.
However, if only one of the two companies takes the ownership or has significant advantage over the other, the process is called “acquisition.” The result will be partial or total loss of one party in favor of the other. Usually, this course of action is taken as a last resort when no other favorable option is available.
Regardless of the circumstances arising from your merger or acquisition, it is crucial to know the facts and certain measures that must be taken when entering into such agreement. The process of creating a new structure and organization for the merger or acquisition requires a lot of planning, research, and legal consultation.
Jurado & Associates, P.A. offers legal services for Mergers & Acquisitions in every facet of your decision-making.