Share purchase or asset purchase?
In a share purchase, the buyer acquires the company itself — with all its history, contracts, liabilities and licences. In an asset purchase, the buyer selects specific assets and liabilities, which can limit exposure but usually requires contracts, employees and licences to be transferred individually. The right structure depends on tax, risk, regulatory and practical considerations, and we advise on it at the outset.
Approvals that can apply in Kenya
Many transactions need regulatory clearance before they can complete. Depending on the parties and the sector, these can include:
- Merger approval from the Competition Authority of Kenya under the Competition Act 2010
- Notification to the COMESA Competition Commission for qualifying cross-border transactions
- Sector regulator approvals — for example in banking, insurance, telecommunications or energy
- Capital Markets Authority rules where a listed company is involved
- Consents required under the target's own contracts, leases and financing arrangements
Protecting your position in the sale agreement
The share or asset purchase agreement allocates risk between buyer and seller. Key terms include the price and any adjustment mechanism, conditions precedent, warranties and indemnities, limitations on claims, restrictive covenants and completion mechanics. For sellers, disclosure against warranties is critical; for buyers, the agreement must address what due diligence revealed.
Common risks and mistakes
- Signing heads of terms that commit you to more than intended.
- Completing before mandatory merger approval — which can expose the parties to penalties.
- Inadequate due diligence on tax, employment, land or litigation exposure.
- Weak warranty and indemnity protection, or seller limitations that make claims impractical.
- Overlooking change-of-control clauses in the target's key contracts.
Who should seek counsel
- Companies and investors acquiring a Kenyan business
- Business owners preparing to sell
- Boards considering a merger or combination
- Foreign investors entering Kenya by acquisition
How we work
- 1Structure and term sheetWe advise on deal structure and the key commercial terms before anything is signed.
- 2Due diligenceWe investigate the target's legal position and report the risks that matter to the price and the contract.
- 3Transaction documentsWe draft and negotiate the sale agreement, disclosure and ancillary documents.
- 4Approvals and completionWe manage regulatory filings, satisfy conditions and run completion and post-completion filings.
Advocates for this matter
Frequently asked questions
No. Merger control under the Competition Act 2010 applies where the transaction is a 'merger' and meets the notification thresholds set by the Competition Authority of Kenya. Whether a deal is notifiable should be assessed early, because completing a notifiable merger without approval can attract penalties.
A share purchase transfers ownership of the company with all its assets and liabilities. An asset purchase transfers selected assets and liabilities only. Each has different tax, risk and practical implications.
Warranties are statements of fact about the business made by the seller; if untrue, the buyer may claim damages. Indemnities are promises to reimburse specific losses, often for risks identified in due diligence.
It depends on the size of the deal, the depth of due diligence and the approvals needed. Regulatory clearances often drive the timetable, so we map them at the start and plan around them.
Generally yes, although some sectors have local ownership requirements or need specific regulatory approval. We review sector rules as part of the initial structuring advice.
Related legal services
This page gives general information about Kenyan law and is not legal advice for your situation. Contacting us does not create an advocate–client relationship. Last reviewed 8 Oct 2026.