I'm trying to find a site or some answers regarding mergers and acquisitions. Specifically, if a company has contracts with clients and the contract does not have a transfer of ownership clause and the compay is merged with a "new" company - does the new company have to create new contracts?
2006-07-18 04:58:24 · 2 answers · asked by rashenbo 1 in Business & Finance ➔ Small Business
No new contracts are necesary. When a company is acquired, the buyer assumes the liabilities of the company it acquired.
2006-07-18 05:13:55 · answer #1 · answered by NC 7 · 0⤊ 0⤋
The new company will have to honor the contracts made by the old company, because it was a valid contract with legal obligations and the new company can be sued for breach of contract if they declare the old companys contract to be null and void. Got it?
2006-07-18 05:05:14 · answer #2 · answered by chp 2 · 0⤊ 0⤋