Asset deal

What an asset deal is

An asset deal transfers individual assets of a business rather than the company itself. What is transferred are machinery, stock, brands, domain, contracts and software licences, each named separately. The company continues to exist and keeps whatever was not transferred.

The opposite is a share deal, where the company changes owner as a whole. The difference sounds formal but carries substantial consequences, because in a share deal every obligation travels along, including the unknown ones.

What transfers and what does not

• Selectable: Inventory, equipment, brands, domains, software licences and customer lists, to the extent they are legally assignable.
• Not automatic: Contracts. Lease, supplier agreements, leasing and insurance do not transfer by themselves but need the counterparty's consent.
• Not assignable without a new relationship: Employment relationships. These transfer by operation of law in a business transfer, with all rights and duties.
• Remaining with the seller: Old liabilities, tax debts and warranty claims from the period before the transfer.

The liability question

The main advantage lies in liability. The buyer takes over the named assets and in principle not the old liabilities. That advantage is not free. First with taxes: liability can arise for operating taxes when the business is continued. Second with products: anyone continuing to distribute a product can be liable for defects regardless of who made it. Third with employees: a business transfer leaves the rights of staff untouched, and a change of company name does not alter that.

The practical consequence is a precise inventory. Every asset needs a list with condition, encumbrances and evidence, such as proof of ownership for brands and licence records for software. Whatever lacks evidence becomes a point of dispute later.

What needs renegotiating afterwards

After the transfer a second block of work begins, often underestimated. Contracts must be concluded anew or rewritten, because the counterparty has to consent. Customer accounts and logins must move, which for payment providers and marketplace accounts often means creating them from scratch. Data processing needs an updated legal basis, because the controller changes. And informing customers is not just courtesy but a duty when company details and bank account change.

For the seller the reverse side decides: whatever is not sold stays with them, along with the work. A list of the burdens the seller keeps therefore belongs in the negotiation, plus a rule on who pays for the unwinding. An asset deal is thus not only a purchase but a division, and that division is the real substance of the negotiation.