An acquisition team needs more than a list of legal risks. It needs to know which findings should change the purchase agreement and what, precisely, the buyer will acquire.

Siwoo Law Firm advised the seller on a proposed transfer of a Korean printing business to a Korean buyer. The engagement covered legal due diligence, drafting the business transfer agreement, and negotiations.

The seller wished to keep the building separate from the operating business, and the buyer intended to lease the building instead of purchasing it. The proposed structure therefore separated the business transfer from the arrangements for occupying the premises.

The challenge: essential records were available only on site

The target retained key documents as paper originals and would not allow them to leave its premises. A conventional virtual data room review was therefore unavailable.

Siwoo prepared a document request list before the site visit. It covered corporate records, permits, assets and liabilities, commercial contracts, employment, litigation, insurance, and intellectual property. The legal team then reviewed the original records at the target's premises.

This approach allowed the review to proceed within the seller's document access restrictions and gave the client a structured account of the issues identified.

Turning findings into transaction documents

The team reported on matters including procedures relating to treasury shares, change-of-control restrictions in key contracts, the treatment of employees, contingent liabilities, and outstanding obligations.

The next step was to connect those findings to the agreement. Siwoo helped identify the assets, liabilities, and contracts within the proposed transfer through itemized schedules. The team also drafted representations and warranties reflecting the diligence findings and supported negotiations over the transaction terms.

For a business transfer, that level of detail matters. The description of the business being acquired should be consistent across the diligence report, the agreement, and its schedules. Contractual restrictions also need to be assessed against the actual transaction structure; a clause identified during diligence does not necessarily operate in the same way in a share acquisition and an asset transaction.

The outcome

Siwoo completed the on-site legal review and incorporated the findings into the transaction documentation and negotiations. The work supported the client's assessment and progression of the proposed business transfer.

Relevance for overseas buyers

Although this engagement involved a Korean buyer, the document access issue is equally relevant to an international acquisition team reviewing a Korean target. Before setting a signing timetable, buyers should establish how key records can be reviewed, identify gaps that need to be resolved, and connect each material finding to a contractual response.

The practical deliverable is a set of transaction documents that reflects the business actually being acquired and the risks identified during review.

Related services: M&A and Corporate Law.

This case summary describes a specific engagement. Its outcome does not predict the result of another transaction.