What Are the Different Types of Recycling Plants?

Company acquisition refers to the acquisition of second-hand equipment, which refers to the second-hand equipment and waste materials of the target company, and then acquires all or part of the business of the target company and obtains control over demolition.

Takeovers

Chinese name: Takeovers
Foreign name: Company acquisition

Concept: Second-hand equipment acquisition
Purpose: Take control of demolition
Condition: Two-thirds of shareholders' resolutions passed

1. Internal decision-making process of the acquirer

The acquirer negotiates with the target company or its shareholders to obtain a preliminary understanding of the situation, and then reaches a merger and acquisition intention and signs a letter of intent to acquire.

In order to ensure the safety of M & A transactions, the acquirer generally commissions a professional team of lawyers, accountants, appraisers and other personnel to conduct due diligence on the target company; and in order to promote the success of the M & A project, the target company generally needs to provide the acquirer with the necessary information and disclose If a company's assets, operations, finances, claims, debts, organizations, labor, personnel and other information encounter malicious mergers or acquisitions or the information disclosed by the target company is not true, it will cause greater legal risks to the other party.

Therefore, in the preparatory stage of mergers and acquisitions, we recommend that the parties to the merger and acquisition sign an exclusive negotiation agreement to make preliminary agreements on merger and acquisition intentions, payment guarantees, trade secrets, disclosure obligations, and liabilities for breach of contract (the acquirer is a listed company and special attention should be paid to the other party's Confidentiality and information disclosure support obligations), so that the arbitrariness of the merger and acquisition process can be avoided, and the interests of both parties in the merger and acquisition can be protected in the event of premature merger and acquisition breakdown.

(1) Scope of legal due diligence

At the due diligence stage, lawyers can conduct a legal assessment of the materials provided by the target company or the information obtained through investigations through legal channels, and verify the relevant information obtained in the preliminary stage in case the acquirer makes an acquisition decision with sufficient information.

The investigation and verification of the basic situation of the target company mainly involves the following (the specific content of the investigation can be appropriately increased and decreased according to the actual situation of the merger and acquisition project and in compliance with laws and regulations):

1. The business scope of the target company and its subsidiaries.

2. Relevant documents for the establishment and change of the target company and its subsidiaries, including business registration materials and approvals from relevant authorities.

Representatives of both the acquirer and the target company's creditors formed a group to draft and implement a plan for the implementation of the acquisition. The creditor and the acquiree reached a debt restructuring agreement to agree on debt repayment after the acquisition. The acquirer and the purchaser formally negotiated and negotiated to sign the purchase contract.

After the transfer agreement is reached, the acquirer should complete the relevant change registration as soon as possible. If the shareholders of a limited company have changed, they should go to the administrative department for industry and commerce to register for the change; if the ownership of certain assets, such as real estate, changes, they must also go to the relevant administrative department to register in order to obtain real rights. In the acquisition negotiation, the acquirer should try its best to stipulate in the transfer agreement the obligations that the transferor undertakes in the process of changing registration procedures, so as to avoid the transferor deliberately delaying the processing time after receiving the transfer payment, or hiding some of the procedures Required documents.

Merge: merge;

Acquisition : acquisition, purchase, generally asset acquisition and equity acquisition;

Reorganization : the conduct of divestiture, transfer, etc. of assets, personnel, business, etc. that are not included in the scope of the acquisition before the acquisition;

After the acquisition, gain control of the enterprise or asset and re-integrate the enterprise or asset.

Characteristics of equity acquisition

1. The object of equity acquisition is not the property of the company in operation, but equity.

2. The result of the equity acquisition is not a change in the company's actual property, but a change in the structure of the corporate governance structure; in other words, a change in the company's shareholders, directors and even senior managers.

3. In the main body of equity acquisition, the transferor is the company's shareholders, and the transferee can be other shareholders of the company or individuals or organizations outside the company.

1. The acquirer negotiates with the target company or its shareholders to obtain a preliminary understanding of the situation, then reach an acquisition intention and sign a letter of intent to acquire.

2. With the assistance of the target company, the acquirer cleans up the assets, claims and debts of the target company, conducts asset assessment, conducts a detailed investigation of the target company's management structure, and conducts statistics on the situation of employees.

3. A working group is formed by the acquirer and the target company to draft and implement a plan for the implementation of the acquisition. In the case of asset acquisition or creditor's rights acquisition, the lawyer should prompt the client to have creditor representatives in the working group members based on the actual needs of the acquisition project.

4. In the acquisition of assets or the purchase of creditor's rights, the creditor and the acquiree can reach a debt restructuring agreement to agree on debt repayment after the acquisition.

5. The acquirer and the purchaser formally negotiated and negotiated to sign the purchase contract.

6. In accordance with the company's articles of association or the company law and related supporting regulations, both parties perform their own internal approval procedures for acquisitions.

7. According to the requirements of laws and regulations, both parties will submit the acquisition contract to the relevant departments for approval or record.

8. After the acquisition contract becomes effective, the two parties perform the procedures for registration of equity changes and transfer of management rights in accordance with the contract, which involves the acquisition of creditors' rights, fulfills the obligation to notify the debtor in accordance with the law, and handles registration of changes including shareholders in accordance with law.

The role of a lawyer in the acquisition of a limited liability company's equity can be summarized as "one design, two reviews, and three participations."

(I) Design Transfer

Equity acquisition is a new method of asset transfer. If it is difficult for a company to make a decision and the concept of equity acquisition is ambiguous, this requires our lawyers to carefully analyze the current status of the companies on both sides of the equity acquisition, the assignee and the transfer intention to help the company Decision makers make the right choice.

For example, the design of the joint venture's foreign shareholders' exit: equity purchase or liquidation?

Shareholders' setting at the time of management's acquisition: whether the holding company makes the acquisition or the individual directly makes the acquisition?

(II) Review the qualification of the target company

The legal significance of reviewing the subject qualification of the target company invested in the equity acquisition is to accurately confirm:

The establishment, existence, and legality of management of the target company;

What is the nature of the target company, such as state-owned enterprises, foreign-invested enterprises, unlimited liability companies, listed companies, special industries (industry access restrictions or foreign investment access restrictions), etc .;

The legitimacy of the equity and the owner of the equity, that is, who legally owns the equity of the target company and who has the legal subject qualification to transfer it. For example, there is a problem of inconsistency between registered shareholders and actual shareholders, and the true investment of registered capital.

(3) Examining relevant documents and property

1. Review related documents

Reviewing the relevant documents is a very important part. The main purpose of reviewing the relevant documents is to confirm the authenticity of the relevant documents so that no problems will arise in the future performance of the contract.

Examining laws and regulations prohibiting and restricting the acquisition of equity;

Review the restrictions on the acquisition of equity (transfer of equity), procedural rules, etc. of the target company's articles of association;

Examine the articles of association of the acquiree (equity transferor), including the provisions on deliberative powers.

2.Review related property

(1) Examination of tangible assets, property rights, disputes, mortgages, seizures, etc.

(2) Examination of intangible assets. Ibid.

(3) Review the entire creditor's rights and debts of the target company, including: what are the due credits, what are the due debts, whether the time limit for litigation has expired, and whether there is any possibility of recovery; In the case of creditor's rights and debts, the case should be analyzed and a legal opinion issued. Can use the basis of the accountant's work.

(4) Examine other aspects of the target company and conduct detailed due diligence.

(5) Issue an announcement to inform creditors to prevent possible contingent debts of the target company from causing the transferee to assume unnecessary debts after the transfer.

(IV) Participation in asset evaluation

Asset appraisal is sometimes necessary, such as in the acquisition of a state-owned company's equity.

The transaction price of equity acquisition is very important. Choosing a good asset evaluation agency is of great importance. Lawyers must strictly control four criteria when participating in the asset evaluation of the transfer company:

1. The eligibility of the subject of the assessment agency is qualified, that is, whether the assets of the transfer subject are evaluated as legitimate by the assessment agency. In 1991, the State Council s State-owned Assets Appraisal Management Measures and relevant implementation rules stipulated that asset appraisal agencies must have a license issued by the people s government at or above the provincial level in order to be eligible for appraisal. The same applies to collective enterprises and foreign-funded enterprises Regulations.

2. The appraisal capability of the asset appraisal agency. During the equity acquisition process, the corporate assets involved include both tangible assets such as fixed assets, as well as intangible assets and intellectual property rights. Due to the different nature of the company's operations and the types of assets, lawyers should know whether the assessment agency has the right to evaluate equity. The acquisition of expert equipment for company assets, especially the assessment of intangible assets, must involve the participation of experts with knowledge of intangible assets.

3. The social credibility of the asset evaluation agency. As the attorney representing the acquirer, it is advisable to advocate the acquisition of an evaluation agency by the acquirer.

4. Appraisal methods of asset appraisal agencies. The results of different assessments are often very different. There are currently four valuation methods commonly used: liquidation price method, current market price method, present value of income method, and replacement cost method. The current market price method, also known as the market comparison method, refers to an evaluation method that selects the same or similar assets in the market recently as a reference or price standard and compares them with each other to determine the value of the asset. The replacement cost method is based on the current and replacement costs of the entire new value of the asset, after deducting the accumulated discount amount of the useful life and intangible losses, and then confirming the current value of the assessed asset. What kind of assessment method to take is an important task for lawyers to help companies weigh the pros and cons.

The biggest risk of a company's acquisition is the issue of reputation. This reputation has two layers. One is the reputation of banks, taxation, and industry and commerce. The other is the reputation of society. We will explain them one by one.

If an enterprise has any previous bad behavior such as tax arrears, tax evasion, not participating in annual inspections, etc., it is naturally bad in the historical records of bank tax industry and commerce. This kind of thing is often difficult for some acquirers to find. When you take over such a company and go to the industrial and commercial tax office, you will find that the special manager is very difficult to speak. At this time, you will find out how "recruiting" this company is. Annoying. "

In terms of social credibility, it is the unit or individual who has a cooperative relationship with the business and the business dealings with it. This kind of credible acquirer is not very easy to check. You can't always ask one by one. If you are looking for a company with bad reputation, The acquisition is also a trouble. For example, you must pay the full price first for a purchase. If the reputation is good, it is often not necessary.

In this age when goodwill is paramount, the reputation of an enterprise is often regarded as an intangible asset. The reputation value can affect all aspects of the business process. Any business is operated by people. The reputation you give to others is not good. Naturally, the approval of others will not be obtained, and the relationship will be lost a little.

What Are the Different Types of Recycling Plants?

Takeovers

IN OTHER LANGUAGES

RELATED ARTICLES

How can we help?