Private equity (transactions)—Switzerland—Q&A guide

The following Financial Services practice note provides comprehensive and up to date legal information covering:

  • Private equity (transactions)—Switzerland—Q&A guide
  • 1. What different types of private equity transactions occur in your jurisdiction? What structures are commonly used in private equity investments and acquisitions?
  • 2. What are the implications of corporate governance rules for private equity transactions? Are there any advantages to going private in leveraged buyout or similar transactions? What are the effects of corporate governance rules on companies that, following a private equity transaction, remain or later become public companies?
  • 3. What are some of the issues facing boards of directors of public companies considering entering into a going-private or other private equity transaction? What procedural safeguards, if any, may boards of directors of public companies use when considering such a transaction? What is the role of a special committee in such a transaction where senior management, members of the board or significant shareholders are participating or have an interest in the transaction?
  • 4. Are there heightened disclosure issues in connection with going-private transactions or other private equity transactions?
  • 5. What are the timing considerations for negotiating and completing a going-private or other private equity transaction?
  • 6. What rights do shareholders of a target have to dissent or object to a going-private transaction? How do acquirers address the risks associated with shareholder dissent?
  • 7. What notable purchase agreement provisions are specific to private equity transactions?
  • 8. How can management of the target company participate in a going-private transaction? What are the principal executive compensation issues? Are there timing considerations for when a private equity acquirer should discuss management participation following the completion of a going-private transaction?
  • 9. What are some of the basic tax issues involved in private equity transactions? Give details regarding the tax status of a target, deductibility of interest based on the form of financing and tax issues related to executive compensation. Can share acquisitions be classified as asset acquisitions for tax purposes?
  • More...

Private equity (transactions)—Switzerland—Q&A guide

This Practice Note contains a jurisdiction-specific Q&A guide to private equity (transactions) in Switzerland published as part of the Lexology Getting the Deal Through series by Law Business Research (published: January 2021).

Authors: Niederer Kraft Frey—Patrik R Peyer; Daniela Schmucki; Till Spillmann; Dr. Philippe A. Weber

1. What different types of private equity transactions occur in your jurisdiction? What structures are commonly used in private equity investments and acquisitions?

In the Swiss market, all standard PE transaction structures and strategies to invest in, grow or acquire profitable portfolio companies are present. Normally, buyout or growth investments in Switzerland are structured such that the fund incorporates a new Swiss special-purpose acquisition vehicle (SPV) to buy the shares in the target portfolio company. For tax, financing and other purposes the Swiss SPV will often be held via a foreign-domiciled SPV (eg, Luxembourg). While the Swiss SPV is typically formed with only the minimum share capital of 100,000 Swiss francs, the fund managers draw down the capital committed by the investors shortly before the transaction to fund the Swiss SPV with the required equity to complete the transaction. Venture capital investors, on the other hand, generally acquire participations in portfolio companies directly through one (or several) of their investment funds.However, creativity is emerging in a crowded market and thus specialisation and innovative deal structures have become more

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