Asset Acquisition:

Acquiring purchases all or substantially all assets of Target

Acquiring corp.

shareholder
A
shareholder
B
shareholder
C
shareholder
D
Board of
Directors
Board and shareholder approval of Target
Board (and maybe shareholder) approval of Acquiring
assets of Target sold for $$$

Target corp.

Board of
Directors
$$$
assets
Lender
$$$
Asset Acquisition:
Acquiring purchases all or substantially all assets of Target

Acquiring corp.

shareholder
A
shareholder
B
shareholder
C
shareholder
D
Board of
Directors
Alternate:
use Newco subsidiary to acquire assets of Target

Target corp.

Board of
Directors
$$$
assets

Newco

Stock Purchase: Target becomes subsidiary of Acquiring

Acquiring corp.

shareholder
A
shareholder
B
shareholder
C
shareholder
D
Board of
Directors
Step #1:
Acquiring buys stock of Target from shareholders

Target corp.

Board of
Directors

$$$
stock
Stock Purchase: Target becomes Subsidiary of Acquiring

Acquiring corp.

shareholder
A
shareholder
B
former T
shareholder
C
$$$
former T
shareholder
D
$$$
Step #2:
Target becomes subsidiary of Acquiring
Board of
Directors

Target

Share Exchange: Acquiring buys Target with its stock

Acquiring corp.

shareholder
A
shareholder
B
shareholder
C
shareholder
D
Board of
Directors
Step #1:
Board and shareholder approval of Target
Board (and maybe shareholder) approval of Acquiring

Target corp.

Board of
Directors
Share Exchange: Acquiring buys Target with its stock

Acquiring corp.

shareholder
A
shareholder
B
shareholder
C
shareholder
D
shares of
Acquiring
Step #2:
Shareholders of Target exchange their shares of Target for shares of Acquiring
Acquiring owns Target shares


Target corp.

Board of
Directors
shares of
Target
Board of
Directors
Stock Exchange: Acquiring buys Target with its stock

Acquiring corp.

shareholder
A
shareholder
B
shareholder
C
shareholder
D
Step #3:
former shareholders of Target now own shares of Acquiring
Target becomes subsidiary of Acquiring
Board of
Directors

Target corp.

Board
Corporate Merger: Target into Acquiring

Acquiring corp.

shareholder
A
shareholder
B
shareholder
C
shareholder
D
Board of
Directors
Step #1:
Board and shareholder approval of Target
Board (and maybe shareholder) approval of Acquiring

Target corp.

Board of
Directors
Corporate Merger: Target into Acquiring

Acquiring corp.

shareholder
A
shareholder
B
shareholder
C
shareholder
D
$$$
Step #2:
Target merges into Acquiring under Corp. statute
Shareholders of Target get cash for shares of Target

Target corp.

Board of
Directors
assets & debts
Corporate Merger: Target into Acquiring

Acquiring corp.:
owns assets & debts
of Target

shareholder
A
shareholder
B
former T
shareholder
C
$$$
former T
shareholder
D
$$$
Step #3:
shareholders of Target cashed out
Acquiring takes assets & debts (and tax attributes) of Target
Board of
Directors
Corporate Merger: Target into Acquisition Subsidiary

Acquiring corp.

shareholder
A
shareholder
B
shareholder
C
shareholder
D
$$$
Alternate Step #2:
Target merges into Newco acquisition sub
Shareholders of Target get cash for shares of Target

Target corp.

Board of
Directors
assets & debts

Newco: acquisition sub.

Corporate Merger: Target into Acquisition Subsidiary

Acquiring corp.

shareholder
A
shareholder
B
former T
shareholder
C
$$$
former T
shareholder
D
$$$
Alternate Step #3:
Newco acquisition Sub owns assets of Target
old shareholders of Target cashed out
Board of
Directors

Newco: acquisition sub.
owns assets & debts of Target

Statutory Merger (short-form merger)

Parent

shareholder shareholder
Step #1:
Parent own 90% or more of Subsidiary
Board of parent approves merger of Sub into Parent
approval of Board & Shareholders of Sub not required
minority shareholders cashed out
have (dissenters) appraisal rights
Board of
Directors
subsidiary
Board of
Directors
90% or >
minority
shareholders
10% or less
$$$
Statutory Merger (short-form merger)

Parent

shareholder shareholder
Step #2:
Sub merged into Parent
Parent acquires assets and debts of former Sub
Board of
Directors
subsidiary
sub merged into parent
former
shareholders
$$$
Statutory Merger (short-form merger)

Parent:
with assets & debts
of former Sub

shareholder shareholder
Step #3:
Parent owns assets and debts of former Sub
Board of
Directors
Divisive Reorganization: Spin-Off


Corporation:
Business X
Business Y


shareholder
A
shareholder
B
Board of
Directors
Divisive Reorganization: Spin-Off


Corporation


shareholder
A
shareholder
B
Step #1:
drop businesses X and Y into new subsidiaries


Newco 2:
Business Y




Newco 1:
Business X


Divisive Reorganization: Spin-Off


Corporation


shareholder
A
shareholder
B
Step #2:
distribute shares of Newco to
shareholders of Corporation


Newco 1:
Business X




Newco 2:
Business Y


distribute
shares
Divisive Reorganization: Spin-Off


Newco 1:
Business X


shareholder
A
shareholder
B
Step #3:
A and B own shares of both Newco 1 and Newco 2


Newco 2:
Business Y


Foreign Corporation with U.S. Subsidiary


Foreign Corporation

100%
shareholder shareholder
parent is foreign corporation
subsidiary operates business in U.S.

U.S. subsidiary


shareholder shareholder