AC­QUI­SI­TION

Collective Hub - - FEATURE - WHAT IT IS: WHEN IT’S BEST: THINGS TO CON­SIDER: IT HAP­PENED TO:

“Depend­ing on your sit­u­a­tion, if a com­pany is in fi­nan­cial dif­fi­culty, you may be able to trans­fer the own­er­ship of that busi­ness or com­pany to an­other per­son or com­pany,” says Jeremy. “You need to sell the busi­ness at mar­ket value and use this as a means to pay back your debts.” A sale can in­clude sell­ing in­tel­lec­tual prop­erty or tan­gi­ble as­sets such as premises or equip­ment, cus­tomer lists and graphic el­e­ments such as lo­gos.

If your busi­ness still has gen­uine value. “You can­not use this as a way to get around pay­ing peo­ple what you owe them,” says Jeremy. “There are many laws that are in place to stop this from oc­cur­ring. If the trans­ac­tion can be shown to be de­signed to de­feat cred­i­tors or be un­com­mer­cial then it can be overturned.”

Make sure you do your home­work. A PwC sur­vey found a star­tling lack of prepa­ra­tion among com­pa­nies that were hop­ing to be ac­quired. Although the com­pa­nies tended to be up to date on taxes, less than a quar­ter had au­dited their fi­nan­cial state­ments, and only 11 per cent had com­pleted a for­mal val­u­a­tion.

Nasty Gal. Af­ter Sophia Amoruso’s edgy fash­ion em­pire an­nounced it was fil­ing for “bank­ruptcy pro­tec­tion” to re­or­gan­ise its af­fairs as a re­sult of de­clin­ing sales, the on­line re­tailer Boohoo bought the rights to its in­tel­lec­tual prop­erty – Nasty Gal’s brand name, URLs, so­cial me­dia ac­counts, im­agery, and soft as­sets – as well as its cus­tomer data­base, for US$20 mil­lion. It didn’t, how­ever, as­sume re­spon­si­bil­ity for store credit owed to cus­tomers.

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