What are the shares for a company?

From a legal point of view, a share represents the ownership right of its holder over a share in the company. The holder of one or more shares of a company has the right to dividends granted from its profit, has the right to participate in decision-making, through the General Meeting of Shareholders, and is entitled to a share of the amounts resulting from a possible liquidation of company, in proportion to the number of shares detained.

Mergers and the acquisitions of shares


An usual way to acquire a company is to buy shares. This process can start with the purchase of smaller packages of shares and can end with a public offering to buy the shares of the target company. The public offer is made directly by the company to the shareholders of the target company.

There are several factors that can influence the decision to acquire shares or to merge. In the case of the acquisition of shares, the meeting of shareholders is not necessary and their votes do not matter either. If the shareholders of the target company do not like the offer, they are not asked if they accept or have to sell the shares they own. In a share purchase, the acquiring company may deal directly with the shareholders of the target company through a public offer without taking into account the option of the management or of the board of directors of the targeted company. In some cases, the managers of the target company show a certain resistance, and this behaviour will cause an increase in the cost of acquiring the shares so that it is higher than the cost of a merger. Frequently a minority of shareholders will hold a significant stake and thus the target company cannot be completely absorbed. The complete absorption of one company by another is achieved through a merger.

What it means to hire a lawyer specialized in M&A (Mergers and Acquisitions)

M&A lawyers successfully combine legal skills with a unique understanding of the applicable legal framework. A prudent investment policy and the help of a merger and acquisition lawyer will protect you from massive losses, ensuring you perform in the business in which you have invested. Moreover, it goes without saying that the work of a lawyer in M&A Romania is carried out in accordance with the interests of clients and the satisfaction of their needs.

The specialization of lawyers in M&A includes the aspects related to the acquisitions of companies, the afferent financing, the selection and establishment of legal entities, the administration and association contracts, the securities and the aspects of corporate governance.


Hammond’s M&A attorneys and Partners are qualified to assist you with national and cross-border mergers in various industries:

Designing adequate legal structures for the transaction

Choice of jurisdiction

Identifying the legal issues generated by the merger

Reviewing contracts that could be affected by the acquisition of shares

Preparation of the necessary documentation for the transaction

The reorganization of the company in the context of a purchase


There are situations when a company acquires the shares of another company and, after the acquisition, the buying company merges with the acquired company.

A common example is one in which the acquisition is structured as a leveraged buyout (an acquisition with a complex financing and guarantee structure) when the two companies merge (post-acquisition) in order to satisfy the financing and guarantee conditions, imposed by the lender.

In conclusion

In today’s business environment, expansion strategies, partnerships, and divisions within companies or firms often generate a whole host of legal, tax, and regulatory issues that can impact the success or failure of a transaction.

Whether we are referring to the complexity of mergers or acquisitions, or we are talking about consulting for various international players interested in investing in Romania, the clients of our Romanian law firm can be confident that they will benefit from the best legal advice to get the best and appropriate decisions.



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