Compare asset purchase and stock purchase.

The major differences between asset purchase and stock purchase are as follows −

Asset PurchaseStock Purchase
Transfer of ownership is not possible.Transfer of ownership is available.
Can claim tax benefits.Can’t claim tax benefits.
Less complexity.More complex.
Re-negotiation on employee agreement is available.Re-negotiation of employee agreement is not available.
Buyers can choose risk and liabilities to bear.Buyers absorb risk and liabilities.
Ownership can’t be lost and can’t exchange hands.Ownership can be lost, exchange hands.
Less prevalent in market.More prevalent in markets.
Retitling of asset is required.Retitling assets in not required.
Minority shareholders don’t create problems.Minority shareholders can create problems.

Updated on: 25-Sep-2020


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