Asset Deal or Stock Deal? What the Difference Really Means
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Asset Deal or Stock Deal? What the Difference Really Means
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Not all deal structures are created equal, and the one you end up with can change your tax bill, your liability exposure, and how much work closing actually takes. In this episode, David and Shaun break down the two most common deal types, asset deals and stock deals, and explain why the structure matters just as much as the price.
They cover why buyers generally prefer asset deals (clean title, no legacy liabilities, a tax step-up on assets), why sellers often prefer stock deals (favorable tax treatment on partial sales), and what happens to the old legal entity after an asset deal closes. They also touch on more advanced structures like F-reorgs, and explain how milestone or earn-out payments can bridge a valuation gap between buyer and seller regardless of which structure is used.