Stock vs Asset Purchase in Mexico

professional profile

July 24, 2022

by a professional from New York University in Mexico City, CDMX, Mexico

I recently got involved in a transaction where the searchers had certain "budget", and were considering the pros and cons of acquiring the assets vis-a-vis the stock. Here's some tax aspects you should take into account:

Stock:
- No VAT
- Tax liabilities 'stay' with the company

Assets:
- 16% VAT (subject to VAT exemptions), which might not be creditable by the acquiring SPV
- Tax liabilities might still follow the assets, but are easier to 'fence'

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commentor profile
Reply by a searcher
from Universidad Panamericana in Guadalajara, Jalisco, Mexico
I think this is useful. Besides these, I think there are other aspects (not directly tax related) to consider. For instance, the labor liabilities depending on the scheme used for the transfer of employees when acquiring just the assets. Would love to connect and elaborate more on the matter!
commentor profile
Reply by a searcher
from London Business School in London, UK
Interesting! Thank you
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