Taking the Acquisition Route

Buying the assets or stock of another corporation is one way to quickly expand your business. But there are several issues to consider before making a final decision. With taxable direct purchases, the buyer simply pays cash or issues debt (or a combination) in exchange for the target corporation’s stock or assets. This compares to a merger where the buyer generally issues stock to the target company’s shareholders, which means they wind up owning part of the merged company.