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Company Acquisition in Indonesia
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Corporate acquisitions are one of the options that companies take to expand their business. Through acquisitions, an entrepreneur can quickly master a certain business field without having to struggle to start a business from scratch, thus saving time and money.
In Indonesia, company acquisition refers to the process where one company takes control of another by purchasing its shares or assets. This process is governed by Indonesian Company Law and involves various regulatory requirements to ensure compliance and protect stakeholders.
Type of Acquisition
- Share Acquisition: Involves purchasing shares from existing shareholders or issuing new shares. This method results in a change of control over the target company and is regulated under Law No. 40 of 2007 regarding Limited Liability Companies.
- Asset Acquisition: Involves acquiring specific assets of a company rather than its shares. This method is often used to target particular business units and requires different legal processes depending on the asset type (tangible or intangible).
The key benefits of asset acquisitions over share acquisitions in Indonesia
In Indonesia, asset acquisitions offer several advantages over share acquisitions. Here are the key benefits:
Benefit
- Selective Asset Purchase: Buyers can choose specific assets and liabilities, allowing them to avoid unwanted or underperforming parts of the business, thus minimising risk.
- Reduced Liability Exposure: In an asset acquisition, the buyer typically assumes only the liabilities associated with the acquired assets, protecting them from potential hidden liabilities of the entire company.
- Easier Valuation and Due Diligence: Asset valuations can be more straightforward as they focus on tangible and intangible assets, making it easier to conduct thorough due diligence.
- Tax Benefits: Asset acquisitions may offer tax advantages, such as the ability to allocate costs to specific assets, which can lead to depreciation benefits.
- Flexibility in Structuring Deals: The structure of asset deals can be tailored to meet the specific needs of both parties, providing greater flexibility compared to share deals.
- Simplicity in Regulatory Compliance: While asset acquisitions may involve complex licensing issues, they can often be simpler in terms of obtaining necessary approvals compared to share acquisitions, which may require more extensive regulatory scrutiny.
How LMI Consultancy Help With Your Company Acquisition Process
LMI Consultancy helps companies smoothly acquire PMAs in Indonesia by expertly navigating the country’s complex regulations.
- Ensure compliance with local laws, including investment regulations and sector-specific requirements, foreign investors utilise the expertise of legal consultants. We can assist in preparing necessary documentation for permits and licenses.
- We offer aid in negotiations with local partners and stakeholders, ensuring that agreements are legally sound and beneficial for all parties involved.
- Assist in organising GMS meetings, ensuring that all procedural requirements are met to secure shareholder approvals for acquisitions.
- Identifying potential legal risks early in the acquisition process and help investors avoid pitfalls that could lead to costly delays or compliance issues.
- After the acquisition, our legal consultants continue to provide support by ensuring ongoing compliance with Indonesian laws, including reporting requirements to BKPM and other regulatory bodies.
Document Requirements
Identity and contact details of new Company Directors and Commissioner:
- For Indonesian individuals, KTP, NPWP, email and phone number.
- For Foreign Individuals, a valid passport, email and phone number.
Identity and contact details of current Company Directors and Commissioner:
- For Indonesian individuals, KTP, NPWP, email and phone number.
- For Foreign Individuals, a valid passport, email and phone number.
Identity and contact details of current Shareholders and new shareholders:
- For Indonesian individuals, KTP, NPWP, email and phone number.
- For Foreign Individuals, a valid passport, email and phone number.
- For Indonesian companies, please provide scanned copies of the Deed of Establishment, Articles of Association, Tax ID, NIB, and Business License.
- For foreign companies, a scanned copy of the articles of association and/or business license is required.
- Scan a copy of the latest Article of Association along with the SK
- Scan a Copy of the Tax Id, NIB, and Business License
- Copy of the Lease Agreement between the company and building management
Streamline an Easy Company Acquisition in Indonesia with LMI Consultancy
- Consult your inquiry with our professional consultant
- Submit necessary document
- Proceed with the payment
- Application process
- Receive the complete document
Other Popular Company Registration Services in Indonesia
Setup a Business in Indonesia with LMI Consultancy
Established in 2016, LMI Consultancy has been supporting countless individuals in understanding the intricacies of visas, business setup, tax & accounting, and property investment in Indonesia, providing a comprehensive and dependable service.
We take pride in being an ethical and innovative company that places a strong emphasis on exceptional customer service and strives to set a new standard in our industry, guaranteeing a smooth and encouraging experience for our clients.
FAQ
What companies are eligible for acquisition?
Indonesian LLCs of all types can go through acquisitions.
Can you explain the key differences between mergers and acquisitions?
Through company acquisition, one entity gains a controlling stake in another, while Company Merger is a process of merging two or more companies into one Company.
Can a PMA acquire a local company?
Acquiring a local company is possible for PMA; however, the acquired company will be integrated into PMA’s structure.
Disclaimer : Our services in LMI Consultancy provide consulting services focused on ensuring client compliance with applicable immigration and legal regulations in Indonesia. We do not provide or facilitate the production of official government documents, nor do we offer any expedited or preferential access to government services.
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