Merging for growth: Creating a tax-efficient property investment group

The challenge: tax efficiencies

As the property investment business was carried on as a partnership, considerations from a tax and legal perspective were required to ensure the structure of the transaction was as tax efficient as possible for the partners.

Our approach: finding the right structure

We carried out a transfer of the trade and assets of the partnership into a recently incorporated holding company, set up for the purpose of carrying on the investment property business. Consideration for the transfer of trade and assets was the allotment of shares in the holding company to the partners. These shares were then acquired by the investment company by way of a share for share exchange, creating a group structure.

The outcome: group created

With the assistance of our Real Estate team, the investment property business and property portfolio were successfully merged with the UK incorporated investment company, combining the two business together to create a group which would be able to work together for the benefit of their business, reducing risk, costs and assisting with the repayment of debt.

How we made a difference

Drawing on our technical skills and previous experience advising on reorganisations we were able to deliver the transaction to the client. Working closely with our Real Estate team and the tax advisors was important to ensure that the reorganisation worked from a tax, legal and commercial perspective.