Overview

In this section we’ll look at some of the most important aspects of group restructure projects, and how we guide clients through the process to ensure that everything is completed successfully.

A group may decide to restructure for many reasons. Preparing for an IPO, sale, demerger or other similar event. Responding to changes – whether in regulation, the economic environment or other things. Strategic moves like changing the group’s business model, or streamlining operations to reduce costs and admin. And many more.

Whatever the motives for a Corporate restructure, they are complex and important projects. A group’s structure is absolutely fundamental – it defines its component parts, how they relate to each other, and how they interact with the outside world.

So any restructure carries risks. If the legal aspects are not planned and implemented correctly, many different problems can occur, such as:

  • Breach of regulatory approvals, potentially stopping the group from conducting business
  • Tax fines, penalties, adverse assessments and double (or multiple) taxation of the same underlying profits, as well as time-consuming and costly tax investigations
  • Pensions liabilities being triggered, which can incur costs far in excess of the values of the underlying assets
  • Loss of assets when removing legal entities
  • Personal liability risks for directors of participating legal entities
  • Failure to achieve the optimum valuation on corporate finance transactions, if prospective purchasers or investors apply a discount due to legal, transfer pricing or other tax risks

The key to success is following the correct process. Understanding the group’s existing structure; creating a new structure which achieves the desired objectives and also matches the reality of how the group operates; spotting any problems that the change might create; and making sure that all the key people within the group understand and support the project. Of course, the specifics of the process are unique to each project.

This process has many similarities to projects we work on with the intercompany agreements, and indeed many group restructures require ICAs to be amended anyway.

Let’s look at some of the most important aspects of group restructure projects.

Preparing for IPO, exit, significant investment or refinancing

Global value chain restructuring

Legal entity reduction

Intercompany debt streamlining

Post-merger integration

Typical legal elements of cross-border restructuring projects

Key areas of legal risk in cross-border restructuring projects

Why work with us?

World-leading
Legal
experts

We are the world-leading experts and educators in intercompany agreements and related corporate structures.

Global and
cross-functional
approach

We liaise with all the stakeholders involved, not just in tax, to ensure that the intercompany agreements and legal structures we maintain support all of the group’s objective.

Ongoing support
to maintain tax-audit
readiness

We provide an outsourced management service for multinational groups, to ensure that their intercompany agreements are maintained in a tax-audit ready central archive.

I worked with Paul Sutton for many years whilst he was at McGrigors / Pinsent Masons, in my role as Group Tax Manager of Sumitomo Electric Wiring Systems (Europe) Ltd (SEWS-E Ltd), and also for a period as SEWS-E Ltd Company Secretary. In this time I had extremely valuable assistance and advice from Paul, not only as regards general corporate law matters, but also particularly across a wide spectrum of legal aspects of SEWS-E Ltd group transfer pricing policies, implementation, inter-group agreements and legal compliance.

Martin L Kinsey, Group Tax Manager
Sumitomo Electric Wiring Systems (Europe) Limited

I have worked with Paul and his team in structuring significant Corporate Debt and have found his approach to be commercial, pragmatic and measured. I would have no hesitation working with Paul again, as we value his commercial and responsive approach.

Joanne Luce, Director
Acqua Trust Company Limited, Jersey

All-Fill Inc, a US based manufacturer of packaging machinery, has had the distinct pleasure of working with Ivan Hanna and the LCN Legal team in relation to our overseas acquisition projects. Ivan has displayed patience and intricate knowledge of English law as it applies to us as a foreign company. Ivan’s counsel has been calculated and sound, together we tailored an approach that is telling of our company’s aggressive nature. I was most impressed at Ivan’s willingness to dig deep into the details and investigate any way to give our side a competitive advantage while negotiating. Ivan has been our guiding light since our initial engagement.

Ryan Edginton, President & CEO
All-Fill Inc

I have been working with Ivan Hanna over the past year on various corporate matters including a group share restructuring project and intercompany agreements for our transfer pricing compliance. Compared to other corporate law firms I have worked with, Ivan took the time to understand our business, our stakeholders and my needs. He was incredibly responsive and went above and beyond to manage our various stakeholders and turn around a big piece of work in a short amount of time. I have no hesitation in recommending Ivan or LCN Legal – they are what all solicitors should be!

Becky Karver, CFO
Deallus Consulting

It is my privilege to recommend Ivan. He is able to process requirements quickly and formulate an effective strategy that protects one’s commercial interests. He is very personable and exceeds expectations. A great lawyer!

Roop Singh Sood, Executive Producer
AKA Filmworks

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