An asset deal and a share deal are two different ways of selling or acquiring a company. The main difference between the two is whether the company shares, or the assets of the company, are the subject of the transaction.
In an asset deal, the assets or individual assets of the company are sold, for example individual assets such as real estate, machinery, patents, licenses, or customer lists. This means that the existing company continues to exist as a legal entity after the corporate acquisition and the buyer takes over all or only the selected assets.
In contrast, a share deal refers to the sale of shares in the company itself. Here, the entire target company is sold, including all assets and liabilities as well as the legal structure of the company. The buyer thus succeeds the company with the takeover, acquires the company as a whole and becomes the owner of all assets, liabilities, and obligations.
The choice between an asset deal and a share deal depends on various factors, such as the scope of the sale, the tax treatment, or the liability issue. For example, an asset deal may be more advantageous in certain situations where the buyer is only interested in certain assets and wants to limit liability. A share deal, in contrast to an asset deal, may be more advantageous if the buyer wishes to acquire the entire company as part of a business succession or takeover, and strengthen its market position and customer relationships.