Buying a Business in Rhode Island
Purchasing a business can yield great profits in the future. However, individuals and companies looking to buy businesses should be aware of the complications of the transaction.
Purchasing a business occasionally involves laws concerning mergers, acquisitions, negotiations or securities exchanges. These fields are governed by Rhode Island and Federal law.
What Parts of the Business Am I Buying?
If a party wants to direct business operations, the best way is to acquire a right called "control". With control of a business, the party gains all assets and the customer base of the business, plus it also assumed the company's debts. A complete picture of the financial position of the business is important for the purchaser to make his decision. This picture is acquired through a process called "due diligence". The process of due diligence uses Federal and Rhode Island guidelines to protect both parties. If these guidelines are not followed, a party might be found in breach of a legal duty. However, due diligence will lead to a better informed decision concerning whether you want to purchase the business. Also, it will help the business to transition more smoothly to new ownership.
How Much Will the Business Cost?
The cost of a business mostly depends on how much ownership stake is required for control. The value of the business property and the type of business are also important factors. The procedure for how the right of control can be transferred or modified is defined by particular laws in Rhode Island. Procedures may make buying a business more or less expensive than simply the market value of its assets.
How Can a Hopkinton Attorney Help?
Rhode Island poses unique demands that a party purchasing a business must meet. Lawyers practicing in Hopkinton are experienced in Rhode Island law, and can find the cheapest way for you to purchase control of a business.