walslaw, Amsterdam boutique law firm
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Transaction structuring

The right transaction structure protects value before signing, at closing and after completion. The structuring questions set the boundaries within which everything else is negotiated: share or asset, locked-box or completion accounts, earn-out design, escrow or W&I, the holding architecture and the sequence of execution. We work alongside corporate finance, tax and accounting advisors on Dutch and cross-border structures that are legally robust, commercially aligned and still workable under the pressure of signing day.

When clients call us

  • You are designing a transaction structure and want one point of contact for the legal side
  • The choice between share and asset (or hybrid) is open
  • An earn-out or deferred consideration is on the table
  • A pre-completion carve-out or reorganisation is needed
  • Cross-border holding architecture interacts with the transaction

Key legal & commercial issues

I.

Core structuring questions

  • Share deal or asset deal, and whether a hybrid carve-out is needed
  • Locked-box or completion accounts pricing mechanism
  • Earn-out, deferred consideration or seller financing
  • Escrow or W&I insurance for warranty exposure
  • Domestic or cross-border holding structure (with tax counsel)
  • Sponsor equity, management rollover and incentive layering
  • Financing flow, security package and reorganisation steps
  • Regulatory perimeter: merger control, FDI, sector approvals
II.

Working with tax and finance

Structure is rarely a purely legal decision. We work alongside tax advisors, corporate finance and accounting teams to ensure the legal architecture supports the commercial and tax objectives, and to identify at an early stage where an otherwise efficient structure does not translate into the SPA, the financing documents or the notarial deed.

On cross-border transactions, this may involve a Dutch holding architecture below or above the target and a financing flow that aligns with the covenant requirements in the senior facility. A tax advisor assesses the tax implications, including any participation exemption analysis.

III.

Execution management

Structuring is also a matter of sequencing. Carve-outs, pre-completion reorganisations, regulatory filings, financing drawdowns and notarial steps have to be taken in the right order. We map the execution path at an early stage to support an orderly signing process.

What we advise on

What we advise on

  • Choice of structure: share, asset or hybrid
  • Pricing mechanism design (locked-box, completion accounts, mixed)
  • Earn-out, deferred consideration and seller-financing terms
  • Escrow vs W&I and warranty package design
  • Dutch and cross-border holding architectures
  • Pre-completion carve-outs and reorganisations
  • Sponsor and management equity layering
  • Financing flow and security package alignment
  • Regulatory perimeter design (merger control, FDI, sector)

Typical documents and deliverables

Typical documents and deliverables

  • Structure memorandum and step plan
  • Pricing mechanism term sheet (locked-box / completion accounts)
  • Earn-out and deferred consideration schedules
  • Pre-closing reorganisation deeds and shareholders' resolutions
  • Sponsor term sheets and management rollover documentation
  • Conditions precedent schedule and regulatory filing plan
  • Funds flow schedule and notarial coordination

How we support the process

How we support the process

  1. 1

    The commercial, tax and regulatory drivers mapped with the full advisor team

  2. 2

    A structure memorandum setting out the chosen route and a numbered step plan

  3. 3

    Price mechanic and warranty architecture settled before the letter of intent fixes them

  4. 4

    Sequencing of pre-completion steps, regulatory filings and financing drawdowns

  5. 5

    Execution and monitoring of the step plan through signing and closing

Questions clients ask before instructing us

Questions clients ask before instructing us

When should we lock in the structure?
The structure is best settled before the letter of intent, or at the latest in it. Structure decisions cascade: a share or asset purchase determines the tax treatment, the transfer mechanics, the employee position and the diligence scope; the acquisition vehicle determines the financing and the participation exemption analysis; and the perimeter determines which consents are required. Changing any of those after the LOI usually means reopening price, and reopening price late in a process is expensive in both money and credibility. The LOI does not need to resolve every point, but it should record the structure, the price mechanic, the treatment of debt and cash, the conditions and the exclusivity period, so that the parties are negotiating the same transaction.
Is locked-box always preferable to completion accounts?
The locked-box mechanic is not always preferable. It delivers price certainty and avoids a post-closing negotiation, but requires reliable accounts at the locked-box date, a manageable gap to closing and a clear leakage and permitted-leakage regime. It may be less suitable for carve-outs with no standalone accounts, businesses with volatile working capital or seasonality, targets in distress, or transactions with a lengthy period between the locked-box date and closing. In those cases completion accounts, or a hybrid with a limited true-up, can protect the buyer against value drift, provided that the agreement states the accounting policy hierarchy: specific SPA policies, the target's historic policies and the applicable reporting framework. The appropriate mechanic follows the circumstances of the transaction.
How does W&I insurance affect structuring?
W&I insurance changes who carries risk and therefore where the negotiation concentrates. With a nominal seller cap, the warranty negotiation shifts from quantum to scope: the buyer seeks broad warranties because the insurer pays, and the insurer expects the diligence to support them. Escrow and retention structures may be reduced, which can simplify the funds flow. Matters outside the policy's cover, including known issues and risks identified in the underwriting process, require their own indemnity architecture. Underwriting should be factored into the timetable and the policy negotiated in parallel with the SPA rather than after it.
When do earn-outs work?
Earn-outs tend to work where the seller stays involved, where the metric is objective and outside the buyer's control, and where the earn-out period is limited. They are often least reliable where the metric is EBITDA, since EBITDA is the product of post-closing decisions that the buyer now takes, and those decisions can become a source of dispute. Revenue, unit volume, a named contract award or a regulatory approval can be more robust measures. Whatever the metric, the agreement needs a clear allocation of the buyer's operating discretion and any limits on it, an accounting policy hierarchy, an information right, an expert determination clause and clarity on the treatment of an onward sale. The period should be no longer than necessary for the metric to serve its intended purpose.
What is the role of a Dutch holding company in cross-border transactions?
A Dutch holding company can provide legal flexibility in a cross-border transaction, including different share classes, tailored voting and profit rights, and a governance regime that accommodates sponsor and management arrangements. Whether it is appropriate, and its tax implications, depend on the facts and should be assessed by a tax advisor from the outset. The legal structure should then reflect that advice and be workable for the intended transaction.
How do regulatory filings affect structuring?
Regulatory filings set the timetable and they can determine the structure. Merger control filings with the ACM are mandatory above the turnover thresholds and prohibit closing before clearance. The first phase takes four weeks, and any second phase considerably longer. Vifo Act notification applies to vital providers and designated sensitive technologies, and the review usually takes several weeks to several months; we establish case by case which categories apply at the time of the transaction. Sector approvals from DNB or the AFM can take longer still. Because these are closing conditions, they drive the gap between signing and closing, the interim covenants, the risk allocation for a failure to clear, and in some cases the decision to carve an entity out of the perimeter altogether.

Related areas

Back to Mergers & acquisitions

Structure questions are easier early than late.

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