ACQUISITION AND MERGER CONSULTING
Acquisitions, capital transfer and mergers are demands that regularly incur in Phu Quoc city due to the concentration on construction, tourism, restaurants and hotels. Therefore, many enterprises are established and operated within a predetermined project timeline. Afterwards, those enterprises will dissolve to terminate their business existence as well as the legal obligations of the business owners.
However, to execute dissolution procedure, enterprises must complete tax-related procedure and handle related legal issues, which incurs extra cost and prolonged timeline.
Now enterprises have a much flexible option, which is to sell their businesses to another investor or merge into another enterprise to terminate the existence as well as other obligations of the legal representatives. This solution is considered to be time and cost-efficient for enterprises. In addition, both parties will reevaluate the business and other business advantages to improve future operation.
Acquisitions and mergers of enterprises will be contingent upon what values and what are the procedure?
ENTERPRISE’S PORTFOLIO VALUATION
- Appraisal of legal documents to adequately evaluate and comply with the establishment process.
- Appraisal of accounting books, tax documents to ensure compliance and detect whether any risk exists.
- Appraisal of the tangibility and existence of assets and payables.
- Appraisal of the existence of the enterprise’s rights and other obligations up until now.
BUSINESS VALUATION
- Valuation of assets and inventories
- Appraisal and determination of liabilities
- Appraisal and determination of receivables
- Valuation of commercial advantages, intangible assets if any
- Valuation of signed contracts and existing customers
EXECUTION OF LEGAL PROCEDURE FOR ACQUISITION AND MERGER
- Negotiate acquisition and merger contracts
- Prepare the documents and execute related procedure at issuance authorities
- Execute tax procedure if incurred
- Execute the transfer of related documents
WHY CHOOSING VINASC FOR CONSULTING WHEN THERE IS A NEED FOR ACQUISITION AND MERGER?
- Vinasc Group is an entity experienced in the field of acquisitions and mergers.
- We have a team of legal and financial professionals who are experienced in administrative procedure
- We have comparable information as reference for consultation and valuation of the transaction
- Business appraisal procedure in terms of legal and financial are both our strengths
Please contact us to get more detail consultation.
FAQ
Having more questions?
Incurred tax obligations of gains from capital transfer (selling of the company) are stipulated as follows:
- If the business owner is the legal representative, then he or she will pay corporate income tax from capital transfer at a rate of 20% of the gains.
- If the business owner is an individual, then he or she will pay personal income tax from capital transfer at a rate of 5% of the gains.
Business dissolution in case the business owner does not want to carry on is dependent upon the decision of the business owner.
The enterprise is only allowed to dissolve when all the liabilities and other asset obligations are guaranteed to be paid off and the enterprise is not undergoing dispute settlement at Court or Arbitration. Related managers and joint ventures take responsibility of the enterprise’s liabilities.
During the process of business dissolution, the enterprise needs to finalize tax payment before closing tax identification number. This is a difficult step and can incur extra cost and financial risks.
Based on the above-mentioned procedure, the enterprise can make decision by comparing the cost and gains between dissolution and reselling of the business.
Before deciding on the investment method, investors need to evaluate the demand, int ended business lines, estimate the budget for project initiation if newly established, new opportunity for market penetration and exploitation.
Subsequently, the enterprise needs to evaluate the advantages if acquires a business. This is an available resource that can be utilized in the future.
The enterprise should also use business valuation so that both parties can proceed the transaction based on the valuation of the independent enterprise.
The risks usually faced by investors when acquiring or merging an available enterprise are:
- Legal risks: procedure, licenses that are not complying with the laws on business lines.
- Risks regarding tax documents and accounting books
- Risks regarding the past obligations with partners, employees, banks…
To mitigate and control the above-mentioned risks, investors need to carefully assess the documents and the contracted obligations of the enterprise.
The benefits of acquiring a business depend on the intended industry and business line. If it is identical to the old industry the enterprise operates in, then it is an enormous advantage. In detail:
- Available human resource
- Readily built brand and certain level of popularity
- Available customers or potential customers in the future
- Offices, equipment, assets are readily installed and available for use
Especially, the field or business models of tourism services, restaurants, hotels in Phu Quoc makes it an appropriate and popular choice for many investors.
Customer information is always secured.
Transparent working process to ensure the rights and interests of customers.
The procedure is conducted as regulated by the laws.