Term · Capital Measures & Financing
Share Deal
In briefA share deal is the purchase of the shares in a company, whereby the buyer acquires the company together with all assets, liabilities, and risks. Unlike an asset deal, the legal entity changes ownership, which carries over hidden legacy issues and requires careful due diligence.
Definition
A share deal is a transaction form in which the shares (stock or interests) in a company are acquired. The buyer thereby takes over the company as a whole with all assets, liabilities, contracts, and risks. Unlike an asset deal, it is not the individual assets that change ownership but the legal entity.
Why it matters for small caps
At small companies, the choice between a share deal and an asset deal determines which risks and legacy issues are taken over. A share deal also transfers hidden liabilities and is therefore often more due-diligence-intensive from the buyer's perspective.
Common misreadings
- A share deal is not automatically cheaper or simpler than an asset deal; it transfers all of the company's existing obligations and risks along with it.
In the process
Frequently asked
What is the difference between a share deal and an asset deal?
In a share deal, the shares in the legal entity are acquired; in an asset deal, individual assets and contracts; only the share deal transfers the company as a whole.
What risks does a share deal entail?
The buyer also takes over hidden liabilities and legacy issues, which is why careful due diligence is especially important.
When is a share deal preferred?
Often when contracts, licenses, or permits are tied to the legal entity and are meant to remain unchanged upon a change of ownership.
Related terms
Education only, not investment advice. Ranges and thresholds are didactic orientation values, not an official standard.