maximising shareholder value
the challenge:
The shareholders of Sol Construction Limited, were disposing of
their core business to Rok plc but wished to retain an interest in
some of the assets. This needed to be achieved in a structure
that was effective commercially and from a tax perspective.
our approach:
We considered the advantages and disadvantages of a number of
potential structures for the transaction, settling on a s110
demerger as the most appropriate reorganisation prior to a
disposal. This route achieved the objective of transferring
the relevant assets to three separate companies under a members’
voluntary liquidation, with the core business then being disposed
of to Rok plc. Her Majesty's Revenue & Customs were
approached for clearance that no tax liability would arise on the
deemed distribution of assets where the beneficial owners remained
the same.
the result:
The client was able to separate the various
assets of the business into different companies, without incurring
a tax liability on those that were being retained. The
purchaser was able to acquire the part of the business they were
interested in and the existing shareholders now have greater
flexibility to deal with the remaining assets.