Share Purchase Agreement is an agreement entered into between
the buyer and seller(s) of shares of a target company. Usually
Share Purchase Agreements entail that the buyer would be taking
over whole or significantly whole of the undertaking of the
company. In such a scenario, the buyer would not only be taking
over the assets but also the liabilities of a company. Hence any
potential buyer needs to take proper stock of the company before
entering into such a transaction.
Pursuant to this, a potential buyer would undertake due
diligence of a company before investing in the same making it the
first step of the process. The due diligence would vary depending
on the nature, size and activities of the target company.
Typically, the due diligence would involve looking into the
business transactions, permits, licenses, authorizations,
agreements, liabilities, assets, borrowings, etc. of the company.
This would provide a proper idea of the functioning of the company
as well
