This is the first decision in any business sale and the one that determines every other. It is also routinely recorded in heads of terms by people who have not yet asked their accountant — which is the expensive order to do it in.
What Each One Actually Does
On a share sale the buyer acquires the company itself. The company continues as the same legal person, so it keeps its contracts, licences, trading history, employees and liabilities — including the ones nobody has found yet. All that changes is who owns the shares. That is why due diligence on a share purchase is more searching and why warranties and indemnities carry more weight: the buyer is inheriting a history. On an asset sale the buyer takes selected assets out of the company — trade, equipment, stock, goodwill, IP, customer book. The company does not move and generally keeps its liabilities, which is the buyer’s attraction. But nothing transfers automatically except employees, so each contract, lease and licence must be handled individually. Hence the rule of thumb: buyers prefer asset sales because problems stay behind; sellers prefer share sales because it is a clean exit.
Consents, Employees, and Why Tax Decides
An asset sale needs far more consents, and consents set the timetable rather than follow it — material contracts assigned or novated, landlord consent for the lease, licences that may not be transferable at all. A share sale avoids most of that, but not change-of-control clauses, which are triggered by precisely what a share sale does. On employees: on an asset sale amounting to a transfer of an undertaking they transfer automatically with terms, accrued rights and service intact, and nothing the buyer and seller agree changes that. On a share sale the employer never changes, so those provisions are not engaged. And then the deciding factor: the tax treatment of a share disposal and an asset disposal differ, and the seller’s personal position and the company’s position are different questions again. This firm does not advise on tax — that is for your accountant and Revenue’s own guidance — but the procedural point is the useful one: get that advice before heads of terms, because afterwards the price has been agreed on assumptions that depend on the structure, and it does not get changed.
The free structure check walks these questions in two minutes. It is orientation rather than advice, and it is emphatically not tax advice.
Structure not settled yet? That is the good news: 01 5827148.
Richard O’Shea — Solicitor & TEP
Solicitor at Mary Molloy Solicitors, established 1981, and a TEP of the Society of Trust and Estate Practitioners. The firm acts for buyers and sellers on business sales and acquisitions — structure, heads of terms, due diligence, the sale agreement, warranties and disclosure, completion and what follows it. Because a substantial share of Irish business sales are retirement exits, the firm’s estate and succession practice sits alongside the transactional work: the deal and what happens to the proceeds are usually the same client’s problem. Nothing here is tax advice — structure is tax-driven and that belongs with your accountant and Revenue, before heads of terms are signed. 01 5827148 · richardoshea@marymolloysolicitors.com · LinkedIn
General information, not legal advice. This website contains general information about Irish law on business sales and acquisitions. It is not legal advice and does not create a solicitor—client relationship. Every transaction turns on its own facts — the structure, the documents, the parties, the consents required — and advice on yours requires a consultation.
Nothing here is tax advice, and tax drives structure. The choice between an asset sale and a share sale is very largely a tax question, and it should be settled with your accountant or tax adviser, and by reference to Revenue’s own guidance, before heads of terms are signed rather than afterwards. This firm does not advise on tax, does not state rates, thresholds, reliefs or conditions, and does not indicate any tax outcome.
No valuation advice. This firm does not value businesses, does not suggest multiples and does not advise on price. Valuation is for accountants and corporate finance advisers, and it is a separate exercise from the legal work.
Never both sides of the same deal. The firm acts for buyers and, in separate transactions, for sellers — but never for both parties to the same sale. Conflicts are checked at first contact, before any substantive discussion, which is why the first email should name every individual and entity involved.
No outcome or timeline is promised. Nothing on this site states or implies that a transaction will complete, that a consent will be obtained, that a warranty claim will succeed, or that any deal will proceed to a particular timetable. Where another jurisdiction is involved, the law of that jurisdiction applies to what happens there and requires local advice; this firm advises on Irish law only.
Fees. Fees are agreed in writing with the client at the outset. In contentious business, a solicitor may not calculate fees or other charges as a percentage or proportion of any award or settlement.