Asset purchase (also known as a business purchase) meaning

In practice, an asset purchase (or business purchase) is the sale of specified business assets, rather than the shares of the company that owns them. The buyer chooses which assets (for example, stock, equipment, IP, goodwill, contracts and property) to acquire and which liabilities to assume; everything else remains with the seller. The expression is descriptive, not defined in legislation, and is used consistently across England & Wales, Scotland, Northern Ireland and Ireland. On completion, title to the agreed assets passes to the buyer and the buyer becomes responsible only for expressly assumed liabilities, subject to any that transfer by operation of law (for example, employee rights under TUPE on a transfer of an undertaking, and liabilities that run with land or permits). The company itself is not acquired. Asset purchases are documented in an asset purchase agreement or business sale agreement, typically supported by due diligence, disclosure, warranties and indemnities. They often require third‑party consents to assign or novate contracts and licences, and separate steps to transfer land and registered IP. Compared with a share purchase, this structure allows buyers to target assets and manage historical liability exposure.