Merger and demerger schemes

Approach and deliverables

We map the entities, assets, liabilities and proposed effective structure before preparing the scheme workplan. Route eligibility, stakeholder approvals and authority procedures require case-specific legal review.

Support can include an information memorandum for advisers, reconciliation schedules and an approvals tracker. Valuation, accounting treatment and tax conditions are reviewed with the professionals responsible for those opinions.

1. Describe the commercial objective and proposed position of each entity.
2. Reconcile the schedules supporting the transfer perimeter.
3. Coordinate information requests and decisions across the responsible advisers.
4. Track the formal process and implementation evidence within scope.

The working plan should identify dependencies between legal drafting, financial information and professional opinions. A revised perimeter should be reflected consistently across those workstreams.

Information to prepare

• Group structure and scheme objectives
• Accounts and asset-liability schedules
• Creditor and shareholder information
• Material contracts, licences and litigation

Identify shared assets, services, employees and liabilities that cannot be allocated from a division name alone. Record the basis of proposed allocations and the evidence supporting them. Keep estimates and unresolved ownership questions separate from confirmed schedule entries.

A practical example

A demerger separating one division needs reliable records of the assets, liabilities and employees allocated to that division. The accounting perimeter must match the proposed legal transfer.

For the division example, a shared customer contract or central IT system may support both the retained and transferred operations. The preparation pack should identify how that dependency is proposed to be addressed and who must assess it. An allocation in a spreadsheet does not establish the required operational arrangement.

Scope and responsibilities

Tribunal or other authority approval is not guaranteed. Counsel, valuers and statutory professionals perform their respective roles; tax neutrality is not assumed from the scheme label.

The engagement letter records the workstreams included, client decisions and external professional costs. New transaction steps or material changes are assessed before the scope is extended.

The handover can include reconciled schedules, adviser queries, decision records and the status of conditions or filings. It distinguishes a proposed scheme, an approval obtained and implementation actions completed. Changes to banking, contracts, systems and registrations need identified owners after the formal milestone.