Acquisition documentation phase in private equity buyout transactions

Copyright © 2025 LexisNexis
Published by a LexisNexis Corporate expert
Practice notes

Acquisition documentation phase in private equity buyout transactions

Copyright © 2025 LexisNexis

Published by a LexisNexis Corporate expert

Practice notes
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This Practice Note is part of the Lexis+® UK Corporate private equity buyout transaction toolkit.

Timing

Preparation of a first draft of the share purchase agreement (SPA) can begin at any time after the main commercial transaction terms have been agreed and the heads of terms (for the acquisition component of the transaction) have been signed.

The due diligence and disclosure process will run concurrently with the drafting and negotiation of the SPA. The earlier that substantive due diligence is conducted by the private equity investor, the sooner the findings of the due diligence can inform the negotiation of appropriate warranty and indemnity cover in the SPA for the buyer.

Generally, save in situations of an auction sale, the investor's lawyers will prepare the first draft of the SPA and submit it to the seller's lawyers for mark-up. Drafts will pass to and fro up until exchange (signing of the SPA), which will be in advance of completion if there are conditions to completion or simultaneous with completion if there are no conditions to completion.

The

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Jurisdiction(s):
United Kingdom
Key definition:
Private equity definition
What does Private equity mean?

Equity-related capital used to finance change in an unquoted (ie non-public) company. Private equity is an investment in shares which are not quoted on the stock exchange, and are therefore less marketable (and liquid) that public equity (ie quoted shares).

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