Share schemes implications of transferring companies and businesses within a group
Produced in partnership with Sara Cohen of Lewis Silkin LLP and Karen Cooper of Cooper Cavendish
Share schemes implications of transferring companies and businesses within a group

The following Share Incentives practice note produced in partnership with Sara Cohen of Lewis Silkin LLP and Karen Cooper of Cooper Cavendish provides comprehensive and up to date legal information covering:

  • Share schemes implications of transferring companies and businesses within a group
  • Introduction
  • Effect of transferring a business from one group company to another group company
  • SIPs—participants ceasing to be an eligible employee
  • SIPs—participants joining a new group plan
  • SAYE schemes—participants ceasing to be eligible employees
  • SAYE schemes—participants joining a new group plan
  • CSOP options—participants ceasing to be eligible employees
  • CSOP options—participants joining a new group plan
  • EMI options
  • More...

Share schemes implications of transferring companies and businesses within a group

Introduction

Groups of companies undertake reorganisations for many and varied reasons but, regardless of the reason, those reorganisations will often have an impact on existing share plans and other employee equity arrangements. In some cases the impact will be commercial in nature, but care will need to be taken to ensure that any valuable tax advantages are not lost.

The most common types of reorganisation are:

  1. transferring the business of one group company to another group company, often as a consequence of an acquisition or in order to facilitate a sale of a particular part of the business and assets

  2. transferring the shares of one subsidiary to another subsidiary so that the group has the most appropriate structure, often after an acquisition or sale of a business, and

  3. putting a new group holding or parent company on top of an existing parent company, usually to facilitate an IPO or a new third-party investment, without any change to the ultimate ownership of the group

This Practice Note focuses on the first two types of reorganisation referred to above.

For information on the impact of putting a new holding company or parent company on top of an existing parent company, see Practice Note: Share schemes implications of introducing a new parent holding company.

Effect of transferring a business from one group

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