Buying a whole business is complex enough, but buying a share in a business is much more complicated.
This may be an opportunity for many employees to participate in the business they work for, or perhaps a senior management team taking on a part share of a business they are running. Whilst this can be a great opportunity, buying a share of a business has some important issues to understand. If the share is a minority (less than 50%) it can expose the buyer to risks, but without the overall power to control things. If money is invested it may be hard to get that back if the individual wants to move on. Even when shares are given to employees, tax may arise that gives a sting in the tail.
Even once you have successfully negotiated all of these aspects you will need a shareholders agreement in place to protect not only your interests, but those of other shareholders and the business itself.
If you are considering acquiring a share of a business, even from family, take advice on the commercial and tax issues before you commit. We have great expertise in this area so come and talk to us.