What is transformation incorporation, merger and split, according to the Law of SA's

The law of corporations, more known as the SA's Law, part of the grouping of federal laws, ordinary laws, resolutions, normative instructions and acts governing corporations anonymous in Brazilian territory.

Created to directly regulate the exercise of these societies, one of the points that the law covers is the transformation, incorporation, fusion and spin-off of societies, and how should behavior be in front of these events.

In the course of this article, we will better understand what transformation, incorporation, merger and split into the eyes of Law 6,404 of 1976 and its amendments (Law 9.457 / 97, Law 11,638 / 07 and Law 11.941 / 09).

Learn more about transformation, incorporation, merger and spin-off

Being different forms of organization and reorganization of societies before the flow of time, the cited mechanisms end up being used as tools for corporate reorganization, or even to achieve tax aspects. Being forms provided by law, the 3 processes are associated with advantages such as business diversification, better access to financing, competition elimination, among others.

The transformation of companies:

Transformation is the operation by which society passes, regardless of dissolution and settlement, from one type to another.

The fusion of companies:

In fusion of companies, two or more societies join to form a new society. Such an organization, which is born of this Union, assumes all the active and passive rights and obligations of original societies.

The merger can be used for several reasons, whether with the purpose of brand expansion, improvement in the quality of service provision, cost minimization, sales increase and more;

The split:

In the case of spin-off, an entity transfers its equity in its entirety or partially, to another society or more than one. This fission process may constitute new companies or just transfer assets to pre-existing societies.

Some of the benefits of business fission are the favoring of tax planning as well as facilitating business family succession.

Incorporation:

We have the process of incorporation, where one or more societies are absorbed by another. In this scenario, there is the extinction of corporate companies. The incorporating society is then responsible for all the rights and obligations of the corporate company.

Incorporated societies disappear, while the developers remain, with their unchanged legal natures.

An incorporation can be made to concentrate more efforts in research, raise production volume or increase the market share of the incorporator or even as tax planning.

Processes requiring care

All processes mentioned above may be truly useful for the most diverse contexts, after all, the process of constitution and reorganization of companies is one of the essential steps for maintaining societies.

The company, when opting for one of the processes is fusion, incorporation or spin-off must take into account the main aspects in the contracting of the professional, which are:

A - Legal (Protocol, Justification, AGE / Contracting Amendment, Evaluation Report, etc.);

B - tax (including accessory obligations, use of tax losses, etc.); and

C - Accounting.

Because of this importance, audit professionals are usually contracted to analyze all accounting, financial and economic information regarding the projects that are on the screen in the spin-off, merger or incorporation process.

This is why Audilink offers solutions to all managers or guardians for these processes, so that the corporate reorganization happens correctly and according to the precepts of the law.

If you want to know more about our services, talk a little with our specialists right now and understand better as Audilink can help you.