Buying a Business in South Dakota

Buying a business can yield great profits in the future. However, individuals and companies hoping to buy businesses should be aware of the complications of the transaction.

There are Federal and South Dakota laws concerning mergers, acquisitions, negotiations and securities exchange that may impact the purchase of a business.

What Parts of the Business Am I Buying?

When someone buys a business in Spearfish, they are actually gaining the right to direct business operations as they see fit. This right is called ?control? of the business. Control entails ownership of all the assets and customer base of the business, but it also includes the responsibility for that company?s debts and liabilities. Accordingly, the party buying a business will want a complete picture of the financial position of the business. Through a process called "due diligence", the financials of the company are disclosed. In the process of due diligence, Federal and South Dakota guidelines are used to inform both parties. If there is a deviation from these guidelines, one party may be held legally accountable. Following the process of due diligence faithfully, however, leads to a better informed decision about the purchase of the business. It can also help the ownership transfer to go more smoothly.

How Much Will the Business Cost?

Control of a business is sold for an amount that is necessary for a party to acquire an ownership stake. The value of the business property and the type of business factor in to determine the exact price. There are specific laws in South Dakota that dictate procedure for how the right of control of a company can be transferred and modified, and these procedures may make buying the business cheaper or more expensive, depending on a variety of factors.

How Can a Spearfish Attorney Help?

In South Dakota, the law poses requirements for a party purchasing a business to fulfill. An attorney knowledgeable in South Dakota law practicing in Spearfish can help you comply with these laws and acquire control of the business you want to buy as cheaply as possible.