To be able to sell your company or shares successfully in Italy, take note of the market, competitive product features, value, ability to deliver, and personal relationships.
In the Italian mergers and acquisition markets, asset deals are the standard structure for distressed acquisition, and shares deals appear to be more frequently used.
Selling shares or your company can be done through a transfer with the assistance of a public notary in Italy, all parties are advised to be present in person while negotiating the deal. Though, delegation is not bad too. Buyers usually pay the sellers in full on closing the deal.
Sale of shares through a public notary in Italy
It is a general rule prescribed by the Italian legislation that this procedure is performed by a public notary, to sign an official document, attesting that the procedure is completed. Public notaries’ cost in Italy is established in accordance with the value of the transaction and have fixed and variable cost.
Sale of shares through chartered accountants in Italy
You can appeal to a more modern procedure in signing a contract in Italy. This procedure is handled through a chartered account or secretaries, and they are involved in signing the contract. The advantage of this procedure is that it involves more flexibility, it can be performed through an electronic signature while each party completes their deal through an online conference.
Conducting a transaction
Buyers of companies are setting new priorities in their transactions, the company to be sold needs to shed light on the impact of its changing situation, company valuation, and infrastructure, capability to meet the requirement for governmental economic support.
Due diligence increases in line with public awareness, putting the company into the spotlight on ESG compliance, the deal will be a breaker especially when the transaction involves the services of financial investors. Through due diligence, there is accuracy and complexity, deepening the investigation of the deal. Insurers in Italy usually carry out double due diligence scrutiny.
Auction processes are a preferred option for financial bidders.
Types of companies you can sell
The following are the types of companies that can be sold
Joint stock companies (società per Azioni SpA)
The company’s capital is divided into share and the shareholders’ liability are limited by their shares.
Limited Liability Companies (Società responsabilità limitata Srl)
The company’s capital is divided into quotas; the shareholders’ liabilities are limited to their quotas (quotas identify the fraction of capital owned by each member of the company).
Quotas are different from shares, quotas are not securities that can be offered to the public as a financial product, though quotas of SMEs (irrespective of the engagement of the startup especially in innovative activities) can be offered to the public (including through crowdfunding portals).
Ways to sell a company
The buyer checks tax considerations and commercial needs before acquiring your company and the acquisition structures include:
- Sales of shares or other ownership interest
- Sales of specific assets
- Merging the company with a bigger company
Important notice according to Italian Law
The buyer becomes liable by law, jointly with the sellers except when the seller is discharged by creditors to any related debt of your business, provided they are all recorded in the seller’s account. So try to let them know the situation at hand.
The seller is bound by a five-year non-competition obligation. In the deal agreement relating to the business, the other contracting parties can terminate the transferred agreement, if there is a cause, within three months of the transfer.
The seller and buyer are all liable for all pre-transfer tax liabilities, including all unpaid taxes and non-compliances to the tax law a year or two years before the transfer.
The buyer can confirm from the tax authority any tax liabilities at the completion date by applying for a certificate, and the buyer is exempted if there are no liabilities, or the authority does not issue such a certificate within 40 days of the application.
As a seller, if your company owns many branches with market autonomy; you can sell some branches to focus on your core business, non-core branches can be sold separately.
