Frequently Asked Questions About Mergers
Posted: Sat Feb 01, 2025 3:46 am
Merging companies has many advantages. However, as with any transaction, the success of the merger depends on a careful analysis of the benefits and assessment of the risks. It is difficult for private investors to predict how management will act, so investing in a merger of organizations may lead to losses.
In what cases is it necessary to obtain permission from the antimonopoly authority for a merger of companies?
In some cases, permission from the antimonopoly authority is required to merge the assets of companies. This is mandatory if we are talking about merging enterprises managed by different people. However, if the companies belong to the same owner, permission is not required. In this case, you only need to notify the antimonopoly authority within 30 days from the date of registration of the new legal entity and warn it of the planned reorganization one month before it takes place.
If, after the merger of czech republic email list Russian companies, the resources of the new legal entity exceed 200 million rubles, then it will be necessary to notify the antimonopoly service within 45 days after the reorganization.
Permission is also required if the company's total income is more than 7 million rubles, or if the products of one organization occupy more than 35% of the product market.
How does a company merger affect the tax policy of the new organization?
The merger of companies has a significant impact on the tax policy of the new organization. It is important to remember that during the reorganization process, the obligations and rights of each of the enterprises do not disappear, but are transferred to the new company.
Tax authorities may require fulfillment of obligations to pay taxes and accrued penalties. In this case, the transfer of rights and obligations is formalized through a transfer act, which records the amount of tax debts.
It is important to note that payment of taxes and penalties related to violation of tax laws is mandatory after the merger procedure is completed. Regardless of when the debts arose, before or after the reorganization, all tax liabilities must be examined before the merger. It is important to analyze the debts for the last three years and the current period.
What are the risks involved in merging companies?
There are many risks involved in merging companies:
Errors may be made in the valuation of assets. This may happen, for example, due to manipulation of reporting.
Conflicts with trade unions over staff cuts.
Differences in corporate ethics can also be a major obstacle when merging companies from different countries.
The regulator may refuse to approve the transaction. As a rule, this happens during the consolidation of exchanges and other financial institutions.
The profitability of the acquired organization may be lower than planned due to unforeseen circumstances or ineffective management.
If, during a merger, it becomes known that one of the companies is involved in illegal schemes or violations of the law, the reputation of the other organization may be damaged.
In what cases is it necessary to obtain permission from the antimonopoly authority for a merger of companies?
In some cases, permission from the antimonopoly authority is required to merge the assets of companies. This is mandatory if we are talking about merging enterprises managed by different people. However, if the companies belong to the same owner, permission is not required. In this case, you only need to notify the antimonopoly authority within 30 days from the date of registration of the new legal entity and warn it of the planned reorganization one month before it takes place.
If, after the merger of czech republic email list Russian companies, the resources of the new legal entity exceed 200 million rubles, then it will be necessary to notify the antimonopoly service within 45 days after the reorganization.
Permission is also required if the company's total income is more than 7 million rubles, or if the products of one organization occupy more than 35% of the product market.
How does a company merger affect the tax policy of the new organization?
The merger of companies has a significant impact on the tax policy of the new organization. It is important to remember that during the reorganization process, the obligations and rights of each of the enterprises do not disappear, but are transferred to the new company.
Tax authorities may require fulfillment of obligations to pay taxes and accrued penalties. In this case, the transfer of rights and obligations is formalized through a transfer act, which records the amount of tax debts.
It is important to note that payment of taxes and penalties related to violation of tax laws is mandatory after the merger procedure is completed. Regardless of when the debts arose, before or after the reorganization, all tax liabilities must be examined before the merger. It is important to analyze the debts for the last three years and the current period.
What are the risks involved in merging companies?
There are many risks involved in merging companies:
Errors may be made in the valuation of assets. This may happen, for example, due to manipulation of reporting.
Conflicts with trade unions over staff cuts.
Differences in corporate ethics can also be a major obstacle when merging companies from different countries.
The regulator may refuse to approve the transaction. As a rule, this happens during the consolidation of exchanges and other financial institutions.
The profitability of the acquired organization may be lower than planned due to unforeseen circumstances or ineffective management.
If, during a merger, it becomes known that one of the companies is involved in illegal schemes or violations of the law, the reputation of the other organization may be damaged.