| Commentary

138 Introduction

| Commentary

D: REORGANISATION OF INTER-COMPANY INDEBTEDNESS BETWEEN SELLERS AND TARGET COMPANY

1: REORGANISATION OF INTER-COMPANY INDEBTEDNESS BETWEEN SELLERS AND TARGET COMPANY: GENERAL

138 Introduction

The target company often enters into a complicated network of financial arrangements with the sellers. For example, it may lend money to, or borrow from, one or more of the sellers. These arrangements need to be unscrambled when the target company changes hands. Great care is required as the method the parties choose may have adverse tax results. In addition, where the target company is a public company, there is a danger that the transaction will constitute

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