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ARTICLE · 27 SEPTEMBER 2018

Delaware Divisive Merger Statute

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Effective August 1, 2018, the Delaware Limited Liability Company Act (DLLCA) was amended to include a new § 18-217.

United StatesWealth Management
A&O Shearman
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Effective August 1, 2018, the Delaware Limited Liability Company Act (DLLCA) was amended to include a new § 18-217. Section 18-217 allows a domestic Delaware limited liability company (LLC) to divide itself into two or more domestic LLCs and to allocate the assets and liabilities of the dividing LLC (the “dividing company”) among itself (if the dividing company survives the division) and the newly formed LLCs (the “resulting companies”). The dividing company is not required to dissolve in connection with the division and may continue its existence as a surviving company (the surviving company, if one, together with the resulting companies, the “division companies”). The division of a dividing company and the allocation of its assets and liabilities among the division companies are not deemed to be an assignment or transfer of such assets or liabilities for purposes of Delaware state law. Therefore, § 18-217 may be used by a Delaware LLC to circumvent assignment and

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