Transferring company ownership is something that is often done and happens in business. When a company takes over another company, then it can be said to be an act of acquisition.Then, what exactly is the definition of acquisition or transfer of company ownership? What are the objectives, types, and procedures?
Definition of Transfer of Company Ownership
According to the Big Indonesian Dictionary (KBBI), the so-called transfer of company ownership or acquisition is when there is a majority takeover or purchase of shares above 50%.Meanwhile, according to Government Regulation No. 27/1998, transfer of company ownership is defined as a legal action carried out by a business entity or individual to take over all and or most of the company’s shares which results in the transfer of control over the company.
Purpose of Transfer of Company Ownership
The transfer of company ownership is often done to save a business or company from a problem or threat of bankruptcy. With this action, the company is expected to continue to operate, develop, and compete with other businesses.In addition, the transfer of company ownership can also be carried out with the aim of seeking economies of scale, wider market share, diversification, increasing synergies, and reducing costs.By transferring ownership, the company also has the potential to obtain new technology and knowledge, reduce excess capacity and competence, strengthen the main or core business, to obtain consumers of the acquired business.According to Shapiro in Christina (2003: 12), transferring company ownership also brings a number of benefits, such as:
- Increase business growth faster
- Reduce the level of competition
- Entering new markets of impenetrable sales and marketing
- Providing managerial skills, i.e. managerial assistance in managing the assets of the business entity
Types of Transfer of Company Ownership
Based on business linkages, the transfer of company ownership or acquisition can be divided into three types, namely horizontal, vertical, and conglomerate acquisitions.
- Horizontal Acquisition
Horizontal acquisition is the act of transferring ownership of companies with similar businesses. For example, a bank company acquires another bank.
- Vertical Acquisition
Vertical acquisition is the act of transferring ownership of a company to a different industry, but one that can still support each other’s business. For example, a travel company buys a ticketing company.
- Conglomerate Acquisition
This acquisition is done by buying business entities that do not have similar or unrelated businesses. The aim is to enlarge the scale of the conglomerate’s business.
Acquisition Type by Asset
In addition to the three types based on business linkages, acquisitions can also be divided based on what assets are taken over by the company, namely asset acquisitions and management acquisitions.
- Asset Acquisition
In this type of acquisition, the company will take over the assets of another company, with the approval of the shareholders. This is usually done when the company is facing bankruptcy.
- Management Acquisition
For this type of acquisition, executives or officers of a company will become controlling shareholders of another company and take ownership of the company’s shares for themselves.
Company Ownership Transfer Procedure
After knowing the definition, purpose, and types of transfer of company ownership, you also need to know the procedures that a company can take to take over another company.Based on the basic form or object of acquisition, the transfer of company ownership can be carried out through the following three procedures:
- Merger or consolidation
The term merger is often used for the merger of two or more companies to form a new company as a result of the merger. Meanwhile, consolidation is a legal action carried out by two or more companies to consolidate themselves by forming one new company and each company that consolidates itself becomes dissolved.
- Share Acquisition
These acquisitions can be made by acquiring part or all of the shares of a company.
- Asset Acquisition
Acquisitions can also be made by purchasing assets or assets of a company. This can prevent the company from having minority shareholders.
Company Ownership Transfer Requirements
As a company owner, you must also have a good understanding of the procedures for transferring a company, so that the process can run quickly and smoothly. To transfer company ownership, you need to fulfill the following requirements:
- Obtain approval from the company’s organs
Before taking care of the process of transferring company ownership, you as a company owner need to get permission first from the company’s organs as an initial condition for transferring the company. The company organs include the General Meeting of Shareholders, Board of Directors, and Board of Commissioners. When you have received approval, then you can continue the process of transferring the company. But if not, then the process cannot continue.
- Obtain approval from the authorized agency
Company owners are not allowed to transfer ownership to outsiders or foreign parties without obtaining approval from the relevant authorities.
- Have offered shares to other shareholders
Before transferring shares or assets to an outside party, the owner of the shares or company must first offer them to other shareholders as a mandatory transfer requirement. That is a complete explanation of the transfer of company ownership or acquisition, starting from the definition to the procedure. For those of you who are still confused about this, you can immediately consult with Kontrak Hukum.By visiting the page https://kontrakhukum.com/kontrak/, you can enjoy notary deed management services for your company ownership transfer needs. You can also contact Kontrak Hukum via the following link Tanya KH and Direct Message (DM) to our Instagram social media @kontrakhukum.
