In an asset deal the buyer acquires not the shares but the individual components of a business: stock, equipment, contracts, customer base and sometimes liabilities. The company itself stays with the seller, together with its history and its obligations.
Legal basis
There is no separate statutory regime; the transaction follows the ordinary transfer rules for each asset. Movable property passes by delivery of possession (Article 3:90 of the Dutch Civil Code), registered property by notarial deed and registration (Article 3:89), receivables by assignment (Article 3:94), and contracts only with the counterparty’s cooperation through contract takeover (Article 6:159). Where the business has employees, Article 7:662 on transfer of undertaking applies: the employees transfer by operation of law with their terms intact, and that cannot be contracted out.
How it works in practice
The choice between shares and assets is often driven by tax and risk. A buyer who does not want the company’s history opts for assets. The trade-off is a more laborious transaction: every contract must be identified and novated, permits are not always transferable, and customers may refuse to move. A sound transaction therefore starts with an inventory of which contracts contain change clauses.
Where it goes wrong
The biggest surprise is usually the transfer of undertaking: parties assume they can choose which employees come across, whereas the law decides. A second risk is contracts left behind because consent was not obtained, leaving the buyer without a supplier or a lease. Third, the selling company remains as an empty shell, which causes difficulty if claims emerge later.
Related terms
The asset deal is the alternative to the share transfer, connects to due diligence and to the assignment of claims.
Weighing shares against assets? Our corporate law specialists set out the consequences side by side.
