Expertise/Mergers and Acquisitions

Service

Bespoke Structuring of Transactions and Ownership

Where the parties' arrangements cannot be accommodated within direct ownership of interests or a single transaction, control, the distribution of results and future changes are secured through a combination of constituent documents and agreements.

We are most often instructed by:

  • Owners of businesses and groups of companies
  • Partners in a joint business or project
  • Investors entering a business or project

The information on this website is provided for information purposes only and does not constitute a public offer.

What the Service Includes

Timing and Fees
from 10business days
from ₽fee on request

Timing and fees are indicative and are confirmed when the engagement is agreed.

01 / Overview
When bespoke transaction structuring is required
  • Economic interest and participation in management differThe participants' respective stakes in the value of the business, in the distribution of results and in decision-making may differ, and the model of the relationship reflects these differences.
  • Several persons with different interests are involved in the projectOwners, partners and investors may have different levels of participation, financing, control and liability. In such projects, the individual arrangements are aligned with one another as a single system.
  • The relationship may change in the futureThe parties' participation, the allocation of rights or the ownership structure may depend on future events, the development of the business or the performance of the arrangements reached. These scenarios can be taken into account when the structure is first created.
  • Confidentiality is a factorIf it is important to the participants to limit the amount of information about their internal arrangements, the model is selected taking into account mandatory disclosure requirements.
  • The structure is created with a future transaction in mindThe current ownership model may be shaped in anticipation of an investor coming in later, the transfer of part of the business, the sale of an asset or another change in the participants.
  • The objective requires a combination of several mechanismsSome commercial objectives cannot be achieved by a single contract or a single corporate procedure, and individual elements are combined into a coherent structure.
02 / Stages
Stages of structuring
  1. ObjectiveThe commercial goal, the participants' interests and the constraints are identified.
  2. OptionsModels are selected and compared in terms of rights, control and complexity of implementation.
  3. Choice of modelThe structure and the interrelation of its elements are agreed.
  4. Mandatory requirementsDisclosure of information, the competence of corporate bodies and the necessary approvals are checked.
  5. DocumentsConstituent documents and agreements are prepared.
  6. ImplementationResolutions are adopted and registration and other steps are taken.
  7. AdaptationThe structure and documents are amended if the participants, the parties' arrangements or the owners' objectives change.
03 / Outcome
Service Outcome
  • Structure optionsCompared models showing the differences in rights, control, restrictions and complexity of implementation.
  • Chosen modelAn agreed system of charter-level, contractual and security mechanisms and the links between them.
  • Terms for changes in the relationshipRules for the admission of new participants, changes in financing, a future transaction or other agreed scenarios.
  • Implementation documentsConstituent documents and agreements for implementing the chosen model.
  • Updated structureThe amended model and the corresponding documents when the structure is subsequently adapted to new objectives and arrangements.

The outcome of the service is the work performed within the scope agreed with the client.

04 / Projects
Selected Projects
01 / 06

Acting for the buyer

Acquisition of a group of companies in industrial equipment and digital solutions

Challenge

Advising the buyer on the acquisition of shares in a foreign company that owns a Russian manufacturer of industrial equipment and digital solutions for equipment management and monitoring, as well as shares in a Russian legal entity. The acquisition of the foreign company was governed by English law.

What was done

Comprehensive legal due diligence of the Russian business was carried out, covering its corporate history, contractual relationships and intellectual property rights. The foreign ownership structure, title to the shares being acquired and the legal aspects of the buyer's entry into the existing corporate structure were analysed separately. The structure and documents of the transaction were agreed, and the findings on the Russian and foreign parts were reflected in the terms of the transaction and the arrangements for its closing.

Acting for the sellers

Sale of four production assets in a single transaction

Challenge

Advising three sellers on the sale of four production assets of a building materials manufacturer to a single buyer. The assets were held in different ways – through interests in companies, as a property complex and through a mixed structure – and closing for all four assets had to take place simultaneously.

What was done

A single transaction structure was developed: some assets were transferred through the sale of participatory interests and others through transactions with the property complex. The parties and the contractual documentation were coordinated to take account of the different legal regimes for transferring the assets.

Option programme

Option programme for an investment fund linked to asset returns

Challenge

Advising on the design of an incentive programme for the managers of an investment fund and the executives of its portfolio companies (11 companies in the portfolio). The size of the economic participation had to be linked to the actual return on the assets, while retaining control over the terms on which key partners participate.

What was done

A multi-level model was developed: phantom participation in the value of the fund, with the possibility of moving to an equity interest in individual portfolio companies once set targets are met. The terms varied according to each participant's role and level of responsibility, and economic rights were tied to confirmed results.

Partnership arrangements

Structuring a partnership of three owners

Challenge

Advising on documenting the relationship between three partners with different stakes, ownership horizons and expectations regarding the management of the business. A model for decision-making and for changes in ownership was needed under which a significant divergence of interests would not lead to a corporate deadlock.

What was done

A multi-level system of mutual option mechanisms was developed, triggered by predefined circumstances, including changes in financial performance or in the ownership structure and the occurrence of a deadlock. A separate course of action for the partners was set out for each scenario.

Acting for the seller

Sale of an interest in a packaging manufacturer

Challenge

Advising the seller on the sale of an interest in a packaging manufacturer with net assets exceeding RUB 500 million. The seller was also the company's director, so the risk of claims relating to the management of the company being brought against the seller after the exit was taken into account.

What was done

The transaction was structured with possible claims after the transfer of the interest to the new owner in mind. Mechanisms were put in place to limit these risks and protect the seller's interests after closing.

Raising investment

Investment in a developer of treatment systems with a buy-back right

Challenge

Advising on raising investment for a growing company that develops treatment systems. The financing was provided directly to the company, with the investor acquiring an equity stake.

What was done

The transaction was structured with a right to buy back the investor's stake upon the occurrence of agreed conditions. This mechanism combined raising capital to develop the business with a predetermined scenario for changes in ownership.

05 / Questions
Frequently Asked Questions

Drafting a contract documents arrangements that have already been settled. In structuring, the model of the relationship itself is determined first: what rights and interests the participants have, how they are connected and by what means they are to be given effect.

Yes. The mechanism is determined taking into account how the business is organized, the composition of the participants and the nature of the rights granted to them.

The degree of privacy depends on the chosen structure and the requirements of the law: it is determined which information must be disclosed to registration authorities, banks and other authorized persons, and which arrangements may remain confidential.

Yes. The current model is analysed and the changes needed are determined in the light of the new objective, the composition of the participants and existing rights and obligations.

An hourly rate, a fixed fee or a combined model is used; in some cases part of the fee depends on the outcome achieved. The fee is determined by the time actually spent, the complexity of the matter and the overall timeframe of the project, and is agreed before work begins.

Key Contacts
Deni Murdalov Deni Murdalov Partner, PhD (Law), LL.M.

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Other Services in This Practice
Buying and Selling a Business Joint Ventures (Partnerships) Legal Due Diligence Cross-Border Transactions Venture Deals Option Incentive Programmes Documents and Consultations

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