Who we help
- Companies about to receive investment from a new shareholder, whether an individual, a company or a fund.
- Existing shareholders who want to protect their position before an investor comes in and to know how the capital will be split afterwards.
- Investors and new partners who want to join a company and need to understand, before signing, the rights they will have.
- International investors, from inside or outside the European Union, working alongside our foreign investment service.
When it makes sense
- You have received an investment offer and want to know what you commit to by signing the term sheet.
- You are about to open a funding round and first need to put your cap table in order: the table that shows who holds what percentage of the capital.
- A shareholder wants to come in with money while the existing shareholders contribute work, and each contribution must be valued.
- An investor wants to join only part of the business and not the whole company, which often requires a prior corporate restructuring or holding company.
- An investor from outside the European Union is coming in and you need to check whether the transaction requires prior authorisation.
What the engagement can include
- Reviewing or drafting the term sheet: valuation, amount, form of entry, exclusivity, confidentiality and conditions of the transaction.
- Cap table analysis: how the capital is split after the entry and how far the existing shareholders are diluted.
- Structuring the entry: a capital increase, with or without a premium, or a purchase of shares from the existing shareholders.
- Preparing the company for the legal review (due diligence) the investor will carry out.
- Shareholders’ agreement with the rights of the investor and of the existing shareholders: reinforced majorities, information, pre-emption, tag along and drag along, lock-up and vesting, as appropriate.
- General meeting resolutions, deed and registration of the capital increase.
- Coordination with tax and financial advisers, in Spain and in the investor’s country.
What the scope depends on
- The type of investor: an individual, a strategic investor, a fund or an investor from outside the European Union.
- The form of entry: a capital increase, a purchase of shares or a combination.
- How many shareholders there are and whether all of them agree to the investor coming in.
- Whether the investor will review the company in detail and what documents must be prepared.
- Whether a new shareholders’ agreement must be negotiated or an existing one amended.
Once we have studied the documents, we send you a quote tailored to your case.
How we work
- Initial contact. You tell us about your situation and send us the documents.
- Review of the documents and proposals. We review the company’s documents and the investor’s offer and set out the possible routes, starting with the simplest one that achieves the goal.
- Quote and letter of engagement. We send you the quote and the letter of engagement in writing.
- Implementation and follow-up. We see the matter through to the end and coordinate with your tax adviser or accountants (gestoría), the notaries and the registries: the Commercial Register and the Land Registry.
Who handles your matter
Your transaction is handled directly by Sara González Domínguez, a practising lawyer (abogada) registered with the Málaga Bar Association (no. 8502), whose practice focuses on corporate architecture, holding companies and M&A transactions, always backed by the rest of the firm’s team.
If the investor is coming in to buy the whole company and not just a part, the transaction is worked on as a buying or selling a business matter.
Illustrative example: two shareholders of a tourism services company in Marbella, with 50% each, receive an offer from an investor who would contribute 200,000 euros in exchange for 20% of the capital. The term sheet includes 90 days of exclusivity and a veto over the annual budget. Before signing, the scope of the veto is negotiated, the cap table after the increase is worked out and a lock-up on the founders’ shares is agreed, to be written into the shareholders’ agreement.
Frequently asked questions
What is a term sheet?
It is the document that records the basic terms of an investment before the final contracts are drafted: who comes in, how much they contribute, what percentage of the capital they receive, at what valuation, what rights they have and what conditions must be met. It structures the negotiation and avoids misunderstandings, but it does not replace the shareholders’ agreement or the general meeting’s resolutions.
Is a term sheet binding?
Usually only in part. The financial terms are normally stated to be non-binding until the final contracts are signed, but other clauses, such as confidentiality or exclusivity for a period, often are binding. That is why you should check which parts bind you before signing, because it may stop you negotiating with other investors.
What is a cap table?
It is the table that shows who the company’s shareholders are and what percentage of the capital each holds, before and after a transaction. In an investment round it shows how far each shareholder is diluted by the investor coming in and what stake the investor receives. It must match the register of shareholders and the capital shown at the Commercial Register.
What is an investment agreement?
It is the contract in which the investor, the company and, usually, the existing shareholders agree the terms of the entry: the price, how the investment is paid, the conditions for completion, the warranties given about the company and the investor’s rights. It is often combined with a shareholders’ agreement, which governs the relationship between the shareholders once the investor is in.
How does an investor come into a private limited company?
There are two routes. The more common is a capital increase, in which the investor takes new shares, often at a premium. The other is buying shares from the existing shareholders, which must be formalised in a public document (article 106 of the Spanish Companies Act, Ley de Sociedades de Capital). With a capital increase, money goes into the company; with a purchase, it goes to the sellers.
Can the other shareholders stop an investor coming in?
It depends on the route. In a cash capital increase, shareholders have a pre-emption right to take the new shares (article 304), and for an outsider to come in it must be removed by a vote of two thirds (article 199) or the shareholders must waive it. If the investor buys shares, the articles of association may restrict transfers and, if they say nothing, the company must consent to the transfer (article 107).
How do you find an investor?
We do not act as intermediaries between companies and investors. What we do is prepare the entry: putting the company and its cap table in order, deciding what is offered to the investor and in exchange for what, and protecting the existing shareholders’ position in the term sheet and in the shareholders’ agreement. A company seeking investment arrives better prepared for the negotiation if all of that is settled beforehand.
What is a search fund?
It is an investment model in which one or more entrepreneurs raise capital from investors to find, buy and run an existing company. Legally, it involves negotiating the purchase of the company and a shareholders’ agreement between the entrepreneur and the investors, which shares out control, the entrepreneur’s stake and each party’s exit.