Cross Border Mergers - an alternative form of restructuring

UK companies with European businesses looking to restructure are able to take advantage of a new procedure in the UK, as an alternative to a business transfer, which enables a UK company to merge with a company in a different European Economic Area (“EEA”) state.

The Companies (Cross-Border Mergers) Regulations (the “Regulations”) are now in effect in the UK and have put in place for the first time rules to enable mergers between UK companies and companies in different EEA states.  The Regulations apply to both public and private companies with limited liability and apply to a merger between at least two companies from different EEA states. This can provide an additional tool for companies looking at their options for restructuring.

There are three types of merger and the procedure involves a Court process. In each case, the assets and liabilities of the companies being absorbed are transferred to the transferee, and the transferor(s) is dissolved without going into liquidation. Generally third party consents are not required unless the Court orders shareholder or creditor meetings to be held.

Our Corporate department has experience of advising on cross-border mergers and would be happy to discuss these further with you as an alternative form of restructuring.