Summary: Our M&A team successfully represented a 150-year-old closely held corporation in the simultaneous divestiture of its two main business lines—tobacco resale and distribution, and vending, sundry, and convenience store distribution—to two separate strategic buyers. We navigated complex asset carve-outs and intellectual property retention while also serving as landlords' counsel for commercial property leases to both buyers.
The Challenge: Our client needed to execute the simultaneous sale of two distinct business lines to separate strategic buyers while maintaining precise isolation between the asset portfolios. Since both business lines were owned by the same seller entity, the transaction presented extraordinary complexity in accurately capturing and sequestering each pocket of assets with precise carve-outs to ensure clean conveyances to their respective buyers. The deal required sophisticated intellectual property carve-outs to allow the seller to retain certain key intellectual property after divesting both business lines. Additionally, the seller owned commercial properties that both buyers would need to occupy, requiring careful structuring of landlord-tenant relationships that would function effectively post-closing.
Our Strategy: We structured the transaction as two separate and distinct, but simultaneous, asset sales to ensure appropriate legal separation while coordinating the closings. Our approach involved meticulous drafting and negotiation to accurately identify and sequester each business line's assets, creating precise carve-outs that maintained complete isolation between the various business lines as each conveyed to its respective buyer. We carefully negotiated intellectual property carve-outs that protected the seller's retention rights to key IP while providing each buyer with the intellectual property necessary for their acquired operations. We also served as landlords' counsel, negotiating commercial property leases with each respective buyer to ensure the seller maintained favorable terms as landlord while providing buyers with appropriate occupancy rights for ongoing operations.
The Result: We successfully closed both transactions simultaneously, enabling our 150-year-old client to execute a complete strategic exit from both business lines to separate buyers. Our meticulous asset sequestration and carve-out work ensured clean conveyances with no cross-contamination between the two transactions, while the intellectual property carve-outs preserved the seller's valuable IP rights. The commercial property leases we negotiated established sustainable landlord-tenant relationships that provided ongoing revenue for the seller while ensuring operational continuity for both buyers. The transaction demonstrates our ability to handle complex multi-transaction divestitures requiring simultaneous coordination, precise asset allocation, sophisticated intellectual property structuring, and integrated real estate solutions for long-established family businesses executing strategic exits.
