Asset Deal or Share Deal? A Comparison for Sellers
In a share deal the buyer acquires the shares in the company; in an asset deal, individual assets. What this means for liability, contracts, employees, taxes and price — and when each structure fits.
In a share deal, the buyer acquires the shares in the company; in an asset deal, individual assets — machinery, contracts, brands, inventory. This single decision determines who is liable for legacy risks, which taxes apply, whether contracts transfer automatically, and often the final price.
Both routes lead to a sale of the business. But they differ fundamentally in legal mechanics — and the interests of buyer and seller frequently pull in opposite directions.
What is the difference between an asset deal and a share deal?
In a share deal, the buyer acquires the company's shares, for example the shares in a GmbH. The legal entity stays the same. Contracts, permits, employees and liabilities continue unchanged — only the owner behind them changes.
In an asset deal, the buyer acquires individual assets: equipment, inventory, customer contracts, brands. Each asset is transferred individually. The buyer decides what to take on and what stays with the seller.
Who prefers which structure?
Buyers tend towards the asset deal. They can select what they take on, avoid unknown legacy risks and depreciate the purchase price for tax. Sellers of a corporation usually prefer the share deal, because selling shares is often more favourable for tax and the business transfers cleanly as a whole.
| Criterion | Share Deal | Asset Deal |
|---|---|---|
| Object of purchase | shares in the company | individual assets and contracts |
| Liability for legacy risks | passes to the buyer | generally stays with the seller |
| Contracts and customers | continue unchanged | transferred individually, often needing consent |
| Employees | employer stays the same | transfer automatically on a business transfer |
| Tax for seller (GmbH) | often more favourable | often less favourable |
| Tax for buyer | no step-up | purchase price can be depreciated |
| Complexity | usually lower | higher, due to individual transfer |
When is the share deal the right choice?
The share deal fits when a corporation is sold and the business should continue as a whole. It makes sense when many contracts, licences or permits are tied to the company and transferring them individually would be complex or risky. For the seller of a GmbH it is often the more attractive route for tax. The process of such a sale is described in selling a GmbH.
When is the asset deal the right choice?
The asset deal fits sole proprietorships, partial sales and any case where the buyer wants to avoid known or unknown risks of the old legal entity. It is also the usual route when selling a defined business unit — a carve-out. What to consider legally and for tax is covered in asset deal.
What does the choice mean for the price?
Structure and tax directly affect what the seller nets. A higher gross price in an asset deal can look worse after tax than a lower share-deal price. That is why structure belongs on the table early — not only in the contract phase. You should know the rough value of your company beforehand, see what is my company worth?. And why the pure figure is rarely the full picture is shown in why price is not everything.
What is the main difference between an asset deal and a share deal?
In a share deal you buy the shares in the company; in an asset deal, individual assets. In a share deal the entire legal entity transfers with all rights and obligations; in an asset deal, only what is expressly taken on.
Is an asset deal or share deal better for tax?
It depends on the perspective. For the buyer, the asset deal is often advantageous because the purchase price can be depreciated. For the seller of a corporation, the share deal is usually more favourable. Which structure is better net should be assessed for tax in each case — this is not tax advice.
What happens to employees in an asset deal?
Where a business transfer occurs, employment relationships generally pass to the buyer automatically — in Austria under § 3 AVRAG, with all existing rights and obligations. Selectively taking on individual employees is therefore heavily restricted.
Which structure is more common when selling a GmbH?
When selling corporations, the share deal is more common, because it transfers the business as a whole and is often more favourable for the seller's tax. It is not mandatory, though — the structure is a matter of negotiation.
Can I choose the structure freely?
In principle yes, it is part of the negotiation. In practice, buyer and seller pull in different directions for tax and liability reasons. A structured process clarifies early which structure works for both sides.