Tax aspects in M&A transactions

As our experience shows, the acquisition, in particular if executed by industry investors, is very often only the beginning of the restructuring process, involving both the entities acquired and other entities within the group. For this reason, an early stage tax planning (tax structuring of the acquisition, detailed due diligence, etc.) enables realizing the material effects of optimisation much earlier, optimising future intercompany flows from the very beginning or better valuation of acquisition attractiveness. Still, the assessment of tax aspects of acquisition is very often limited to the so-called "standard tax product", i.e. tax due diligence and the assistance in acquisition by the group holding entity.

Our approach

We believe that customized and extended tax analysis leads to measurable, significant benefits (both business and financial), to be realized upon merger and acquisition transactions.

We have extensive experience in transaction tax advisory for financial investors (tax support for private equity funds), industry investors (support in acquisition of Polish firms), but also for Polish entrepreneurs selling their business or finding co-investors.

At the same time, we are aware that tax issues may not be the most important aspects of many M&A transactions, especially those made under time-pressure. We are able to act in line with the set requirements and within given time constraints. We are ready to provide customized tax support to the transaction and adapt to its dynamics. We respond to client's objectives, while being pro-active when analysing tax aspects of transactions (e.g. we inform about tax optimisation opportunities, we point to the need to extend due dilligence, where necessary, etc.).

Customized transaction tax advisory services

We assist our clients (usually not being tax specialists but financial experts or entrepreneurs) in taking more effective and well-informed decisions as to the required scope of tax analysis and support. Instead of "standard tax product", we are able to offer customized transaction tax advisory services.

For „Buy-side" clients we offer:

• Selective tax due diligence focused on identification and quantification of real tax risks (not listing all tax uncertainties which Polish companies face);
• Expended tax due diligence aimed also at identifying tax optimisation opportunities;
• Transaction structuring, including among others: optimization of transaction cost, debt-push-down, cash repatriation, etc.

For „Sell-side" clients we offer:

• Preparation to tax due diligence process - review of companies tax settlements, assistance in managing existing tax uncertainties (application for tax rulings, preparation of defence files, etc.);
• Assistance in negotiations – challenging investors estimation of tax exposure of target company, and its influence on price offered or wording of "Representation and Warranties" in SPA;
• Exit scenario structuring and implementation (including restructuring required before closing).

We provide also standard tax services (products):

We offer the so-called "standard transaction tax services/products", such as:

• Tax due diligence;
• Simple confirmation that corporate investment structure is feasible from the Polish tax perspective;
• Presentation of tax effective exit scenarios