A larger company will often demerge when they want to separate out a multitude of operating divisions as a means of allowing management to focus on core business areas to enhance operational efficiency and create synergy. For a smaller company it maybe where there are two or more areas of trading activity which have the potential to expose the other to financial risk.
Whilst different business scenarios will have common elements, demergers are complex and can be extremely time consuming, requiring expert knowledge of tax and legal issues to avoid potential pitfalls.
Our experts are experienced in helping demerging companies avoid unnecessary tax charges during the transfer of assets. You don’t want your business having to part with cash unnecessarily because you failed to consider the tax issues involved.
It’s worth stating upfront that going through a demerger of a company is not a quick process, however if you’ve got the right team on board it will hopefully be less frustrating and a more straightforward process.
Find out more about how we helped a client demerge their company here.
