Legal Advice For Mergers and Acquisitions

Two individual companies merge for numerous reasons. Normally, it happens because one company suffered from financial mismanagement that it cannot continue with its operation without the proposition of another company to take over their management.

But sometimes, two competing companies may decide to take the functional approach by joining forces and by sharing common distribution for healthy financial liquidation.

In every company merging, both managements need to seek legal advice for mergers and acquisitions so that due order and the line of authority are clear for all the stakeholders involved.

Speaking of order, interested company who's aiming for amalgamation got to meet legal requirements for furnishing of documents coming from board of directors and from representatives of shareholders.

Another part of the legal advice for mergers and acquisitions is the preparation and presentation of the paper certifying the surviving company and the documents attesting the inexistence of the other before the shareholders.

The newly-formed company now has to determine whether it will conduct business on more than one jurisdiction. If yes, application letter needs to be sent to authority for the approval to transact in foreign lands.

And since there has been dissolution of companies, applying for a new federal tax identification number for the company who's taking over the business is necessary. The old ones will no longer have the merit it used to acquire.

Comes along with this application is the furnishing of payroll taxes, unemployment compensation taxes, as well as state tax identification number for sales and use taxes.



By: Stanley Hardin
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