Auskauf

Auskauf is a term used in German-speaking business contexts to describe the purchase of another party’s stake in a company or partnership, resulting in a transfer of ownership and control. It is commonly used when a shareholder or partner exits the company, a majority shareholder buys out a minority stake, or the company itself purchases a stake to reorganize ownership.

Auskauf situations occur in various forms. In corporate and partnership law, it often arises in GmbHs, Aktiengesellschaften or partnerships when a shareholder wants to sell and the remaining owners or the company itself want to acquire the stake. It can also appear in employee participation schemes, where an employee or a former employee sells a stake, and in family or succession planning, where family members or future heirs acquire ownership from other relatives. In some cases, a forced or negotiated buyout can be used to break deadlocks or facilitate strategic realignment.

The purchase price and terms are typically defined in a contract and can be fixed or determined by a valuation method agreed by the parties. Common valuation approaches include determining a fair market value, applying multiples, or using discounted cash flow or net asset value calculations. Payment can be made in cash, through seller notes, or a combination, and earn-outs or contingent considerations may be used when future performance is uncertain. The process usually requires due diligence, a transfer of shares, and, in some jurisdictions, necessary approvals or amendments to corporate documents.

Legal and tax considerations are important in an Auskauf. Issues include transfer restrictions, minority protection, voting rights, and the need for consent from other shareholders or governing bodies. Tax implications for sellers and buyers can be significant, particularly regarding capital gains taxation and post-transaction structuring. Consulting legal and tax professionals is commonly advised.