Should I Buy the Assets or the Company?

Short Answer

In an asset purchase, the buyer selects specified assets and assumed liabilities, subject to law and contract. In an equity or entity purchase, the buyer acquires ownership of the company, which generally retains its contracts, assets, history, and liabilities. An entity purchase may preserve relationships or licenses that are hard to transfer, but it can also carry hidden exposure. The choice depends on taxes, consents, licenses, liabilities, financing, employees, contracts, and deal leverage. Legal and tax advisers should analyze the same proposed structure before the letter of intent fixes it.

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When Does This Become Urgent?

• A critical license or contract may not transfer
• The target has litigation, debt, tax, or compliance history
• The letter of intent specifies a structure without completed diligence

What Usually Goes Wrong?

• Assuming an asset sale eliminates every successor liability
• Choosing entity purchase solely for convenience
• Failing to align price and indemnity with structure

What Should You Have Ready?

• Target entity and ownership records
• Asset and liability schedule
• Material contracts and licenses
• Tax, employee, financing, and consent issues

What Typically Happens Next?

1. Identify the business objective, current commitments, and decision deadline.
2. Review the entity records, contracts, approvals, and facts that control the issue.
3. Coordinate tax, licensing, employment, immigration, or other specialized advice where needed.
4. Document the chosen structure and complete filings, consents, and agreements in the correct sequence.

The appropriate sequence and documents depend on the entity, transaction, location, and people involved. This overview is not a prediction of process or outcome.

Related Questions

• What liabilities can follow me when I buy a Florida business?
• What happens to the lease, licenses, employees, and contracts after a business sale?
• What do I need to start a business in Miami?

Also review Buy an Existing Business in Miami, the Starting or Relocating a Business to Miami hub, and the Ask Aaron hub.

We Don't Make Promises. We Have Results to Prove It.

Aaron Resnick has handled business disputes in Miami since 1998 and is a fourth generation Miami resident. He works hands-on on every case; the client gets Aaron on every major litigation issue, not a junior partner. The Law Offices of Aaron Resnick represents large corporations, Miami businesses and their owners, professional athletes and entertainers in Miami Dade, Broward and Palm Beach counties and across Florida in business litigation and business counsel. Call 305-672-7495 or request a consultation.

This page provides general information and is not legal advice. Prior results do not guarantee or predict a similar outcome.

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