Share deal or asset deal
selling a business in Ukraine

A Ukrainian agribusiness can be sold through the transfer of shares in the operating company or through the sale of selected assets and rights. The choice determines what the buyer acquires, whether the operating company remains the tenant under land leases, how permits and employees are treated and which liabilities remain inside the business.

01 · THE SHORT ANSWER

Two basic transaction models

In a share deal, the buyer acquires an ownership interest or 100% of the target company. The legal entity continues to own its assets, employ its staff and remain a party to its contracts. The buyer also assumes the economic exposure connected with the company’s history.

In an asset deal, the buyer acquires an agreed package of assets or rights, such as property, machinery, inventory, contractual rights or leasehold interests. Each component must be identified, verified and transferred through the appropriate mechanism. Neither structure is automatically safer or more efficient.

02 · SHARE DEAL

Acquiring the operating company

The buyer acquires a participation interest while the target continues to own machinery, property and inventory, remain the tenant under land leases, employ its workforce and perform its financing, supply and customer contracts. This can preserve operational continuity.

The principal risk is historical exposure. Legal, financial and tax due diligence must address debt, security interests, litigation, corporate authority, related-party transactions, tax liabilities and obligations that may not be visible in current accounts. The charter, pre-emption rights, approvals and registration procedure must be checked before signing.

03 · ASSET DEAL

Transferring selected assets and rights

An asset deal can include production property, machinery, vehicles, equipment, inventory, rights under identified contracts, leasehold or sublease interests and intangible assets. It allows the buyer to define the perimeter more selectively.

The structure also creates a more fragmented closing. Real estate and registered rights require relevant registration actions; contracts must be reviewed for transfer restrictions and counterparty consent; permits may be linked to a specific entity, facility or regulated activity.

• define every transferred asset and every exclusion;
• verify title, security interests, arrests and third-party rights;
• identify contracts requiring assignment, novation or consent;
• plan the transfer of inventory, receivables and operational data;
• prepare a separate workforce and transition plan.

04 · LAND BANK

The land bank often drives the structure

An agribusiness land bank is normally a portfolio of leases, registered rights, cadastral records and relationships with landowners. In a share deal, the tenant entity remains unchanged, but the buyer still verifies lease maturity, registration, rent payments, renewal, cadastral data, disputes and the concentration of expiries.

In an asset deal, the transfer or restructuring of land rights becomes a separate workstream. Machinery, buildings and leasehold interests should not be treated as one automatically transferable package. For foreign investors, acquiring shares in a company operating leased land is not the same as directly acquiring title to Ukrainian agricultural land; the ownership chain, sanctions exposure and land status require transaction-specific review.

05 · OPERATIONAL CONTINUITY

Permits, employees, debt and contracts

• In a share deal, the same entity remains the licence holder, subject to sector rules and change-of-control requirements.
• In an asset deal, a permit must not be assumed to follow the related equipment or facility.
• A share deal normally leaves the employer unchanged; an asset deal requires a separate workforce transition plan.
• Debt and litigation remain within the target in a share deal; each asset requires an encumbrance check in an asset deal.
• Financing and material commercial contracts require review for acceleration, transfer restrictions and change-of-control provisions.

06 · TAX AND APPROVALS

The model must be tested for the actual parties

Share and asset deals may produce materially different corporate tax, VAT and accounting outcomes. The analysis should cover the seller, buyer and operating company, the book value of assets, financing, settlement mechanics and price adjustments. A conclusion from another transaction should not be copied without modelling this one.

The parties must also determine whether the acquisition constitutes a concentration requiring prior merger clearance. A structure involving non-Ukrainian investors requires additional sanctions, control-chain, currency and agricultural-land analysis.

07 · CHOOSING THE MODEL

Move from perimeter to closing plan

1. Define the closing outcome

   Establish whether the buyer must control the company, land bank, operating platform, infrastructure or selected assets.

2. Map the perimeter

   Connect legal entities, assets, land rights, contracts, liabilities and permits.

3. Complete red-flag diligence

   Identify issues capable of changing the transaction model before full due diligence.

4. Compare the consequences

   Assess tax, approvals, creditor consents, timing and transfer complexity.

5. Build the closing plan

   Agree price, adjustments, warranties, conditions precedent, settlement and transfer of control.