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ARTICLE · 27 OCTOBER 2023

Pros And Cons: Liquidation Or Demerger

ELIG Gürkaynak Attorneys-at-Law
ELIG Gürkaynak Attorneys-at-Law
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ELIG Gürkaynak Attorneys-at-Law

ELIG Gürkaynak Attorneys-at-Law

ELIG Gürkaynak Attorneys-at-Law is an eminent, independent Turkish law firm based in Istanbul. The...

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Liquidation and demerger (spin-off) are regulated under the Turkish Commercial Code ("TCC").

TurkeyCorporate/Commercial Law

Pros and Cons: Liquidation or Demerger

I. Introduction

Liquidation and demerger (spin-off) are regulated under the Turkish Commercial Code ("TCC").

In case of existence of liquidation grounds, a company may enter into liquidation and terminate its legal personality, or it may terminate its legal personality by transferring its assets through full demerger. Both concepts relatively represent termination of a business under a legal personality. That said, while liquidation refers to final dissolution of a business, demerger is indeed a new beginning under another legal personality.

Accordingly, this article aims to provide a comparative overview on the impact of the dissolution of a company through liquidation or demerger on shareholders, assets, and creditors from the Turkish law perspective.

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The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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