Expertise/Mergers and Acquisitions

Service

Partnerships and Joint Ventures

A partnership is formalized to set out in advance how the partners manage the joint business, finance it, share the results and exit from it. A joint venture combines the resources of independent companies in a common project.

We are most often instructed by:

  • Founders of a joint business
  • Participants in an existing company
  • Investors and new participants joining a company
  • Companies establishing a joint venture

The information on this website is provided for information purposes only and does not constitute a public offer.

What the Service Includes

Timing and Fees
from 10business days
from ₽fee on request

Timing and fees are indicative and are confirmed when the engagement is agreed.

01 / Overview
Partnership agreements and joint ventures

A joint project may be organized through a separate company, on a contractual basis or through a combination of mechanisms; for projects with a Chinese party, the specific features are described on the page on joint ventures with Chinese partners.

When structuring a partnership, account is taken not only of the distribution of interests but also of how the parties will manage the business, finance it, distribute the results and act if the original arrangements change.

  • Roles and involvementThe intended role of each partner in developing the business, their involvement in day-to-day operations and the matters for which they are responsible.
  • Project boundariesThe activities that belong to the joint project, the areas that each participant pursues independently, and the demarcation of their commercial interests.
  • Participants' resourcesFunds, property, technology, intellectual property, the team and other resources of each party, and the terms on which they are used in the joint project.
  • Management and controlThe procedure for forming management bodies, appointing key executives, taking decisions and allocating control between the partners.
  • Capital and financingThe principles of initial and additional financing, the parties' participation in providing new funds and the consequences of changes in that participation.
  • Economic returnDistribution of profits, other payments and reinvestment in line with the economic model of the business and the partners' arrangements.
  • Disposal of interestsTransfers of interests or shares, the admission of new participants, changes of control and the rights of the other partners when the ownership changes.
  • Disagreements and exitA significant divergence of positions, inability to take a decision, one partner ceasing to participate or the termination of the joint business.
  • Protecting the joint businessConfidentiality and use of information, competing activities, relationships with employees and customers, and other circumstances capable of affecting the value of the business.
  • SuccessionFor partners who are individuals, events capable of affecting the composition of the owners and the management of the business: family circumstances, inheritance, a prolonged cessation of active involvement.
02 / Stages
Stages of the partnership
  1. Partners' objectivesThe parties' objectives, their participation horizon and each partner's resources are reviewed.
  2. ModelThe form is chosen: a joint company, a contractual model or a combination of the two.
  3. Management and economicsThe decision-making procedure, financing and distribution of the economic return are determined.
  4. Disagreements and exitDeadlocks, a partner's exit and the termination of the joint activity are worked through.
  5. DocumentsThe charter, the partners' agreement (a corporate agreement, a cooperation agreement or a partnership agreement) and related agreements are prepared and agreed with the partners.
  6. ConsentsResolutions of the management bodies are adopted and consents of third parties and regulators are obtained, where required.
  7. LaunchThe documents are signed, and the company is established or the partner's entry into the existing company is completed.
03 / Outcome
Service Outcome
  • Partnership modelAn allocation of roles, resources, control and economic participation that serves the objectives of the joint project.
  • Constituent documents and agreementsInterlinked drafts of documents on joint activity, financing, management and the disposal of interests.
  • Rules for disagreements and exitRules set out in the documents for deadlocks, changes in the participants and termination of the project.
  • Approval packagePrepared resolutions and documents for obtaining the necessary consents.
  • Launch documentsSigned documents and materials obtained on the establishment of the company or on other completed procedures for launching the partnership.

The outcome of the service is the work performed within the scope agreed with the client.

04 / Projects
Selected Projects
01 / 06

Acting for the buyer

Acquisition of a group of companies in industrial equipment and digital solutions

Challenge

Advising the buyer on the acquisition of shares in a foreign company that owns a Russian manufacturer of industrial equipment and digital solutions for equipment management and monitoring, as well as shares in a Russian legal entity. The acquisition of the foreign company was governed by English law.

What was done

Comprehensive legal due diligence of the Russian business was carried out, covering its corporate history, contractual relationships and intellectual property rights. The foreign ownership structure, title to the shares being acquired and the legal aspects of the buyer's entry into the existing corporate structure were analysed separately. The structure and documents of the transaction were agreed, and the findings on the Russian and foreign parts were reflected in the terms of the transaction and the arrangements for its closing.

Acting for the sellers

Sale of four production assets in a single transaction

Challenge

Advising three sellers on the sale of four production assets of a building materials manufacturer to a single buyer. The assets were held in different ways – through interests in companies, as a property complex and through a mixed structure – and closing for all four assets had to take place simultaneously.

What was done

A single transaction structure was developed: some assets were transferred through the sale of participatory interests and others through transactions with the property complex. The parties and the contractual documentation were coordinated to take account of the different legal regimes for transferring the assets.

Option programme

Option programme for an investment fund linked to asset returns

Challenge

Advising on the design of an incentive programme for the managers of an investment fund and the executives of its portfolio companies (11 companies in the portfolio). The size of the economic participation had to be linked to the actual return on the assets, while retaining control over the terms on which key partners participate.

What was done

A multi-level model was developed: phantom participation in the value of the fund, with the possibility of moving to an equity interest in individual portfolio companies once set targets are met. The terms varied according to each participant's role and level of responsibility, and economic rights were tied to confirmed results.

Partnership arrangements

Structuring a partnership of three owners

Challenge

Advising on documenting the relationship between three partners with different stakes, ownership horizons and expectations regarding the management of the business. A model for decision-making and for changes in ownership was needed under which a significant divergence of interests would not lead to a corporate deadlock.

What was done

A multi-level system of mutual option mechanisms was developed, triggered by predefined circumstances, including changes in financial performance or in the ownership structure and the occurrence of a deadlock. A separate course of action for the partners was set out for each scenario.

Acting for the seller

Sale of an interest in a packaging manufacturer

Challenge

Advising the seller on the sale of an interest in a packaging manufacturer with net assets exceeding RUB 500 million. The seller was also the company's director, so the risk of claims relating to the management of the company being brought against the seller after the exit was taken into account.

What was done

The transaction was structured with possible claims after the transfer of the interest to the new owner in mind. Mechanisms were put in place to limit these risks and protect the seller's interests after closing.

Raising investment

Investment in a developer of treatment systems with a buy-back right

Challenge

Advising on raising investment for a growing company that develops treatment systems. The financing was provided directly to the company, with the investor acquiring an equity stake.

What was done

The transaction was structured with a right to buy back the investor's stake upon the occurrence of agreed conditions. This mechanism combined raising capital to develop the business with a predetermined scenario for changes in ownership.

05 / Questions
Frequently Asked Questions

The key terms are set out before the joint business starts or significant investments are made. In an existing company this is needed when the owners' roles change, investment is raised or the actual relationship diverges from earlier arrangements.

When a partnership is formalized, the main task is to regulate the relationship between the persons who jointly establish or own a business.

A joint venture involves pooling the resources of several independent participants for a common business or a specific project. In addition to the relationship between the participants themselves, the model of joint activity and the arrangements for contributing resources, financing, management and distribution of results are determined.

No. A separate company, a contractual model or a combination of mechanisms are all possible. The choice depends on the participants' resources, the management arrangements, the risks and the expected duration of the cooperation.

A corporate agreement is needed if the partners' arrangements go beyond the charter. It is aligned with the charter, the distribution of interests and the parties' other relationships.

Yes, within the limits permitted by law. The distribution of interests is compared with the voting rules in the charter and in the partners' arrangements. The applicable decision-making procedure is determined for each matter.

The procedure for taking significant decisions and the steps to be taken if no agreed position is reached. The mechanism is chosen taking into account each partner's role, the nature of the business and the acceptable consequences of disagreement.

Ceasing operational involvement does not automatically mean ceasing corporate or economic participation.

How a change in a participant's role affects their rights and relationship with the other owners is determined in advance.

The parties may determine in advance when additional financing is required, who provides it and on what terms, and how a change in participation in the financing affects the relationship between the partners.

The specific mechanism depends on the economic model of the business and the parties' initial arrangements.

Yes. The terms for ending participation are discussed at the same time as the terms for starting the partnership.

The specific model depends on the circumstances of the exit, the structure of the business, the method of determining the participant's economic return and the parties' other arrangements.

First, it is determined which disagreements are considered material and which methods of resolving them are in the parties' interests.

Additional negotiation procedures and mechanisms for changing or ending participation may be used.

Such events may affect the composition of the owners and the management of the business. Their consequences depend on the composition of the participants, the arrangements reached between the partners and the participant's personal circumstances.

If preserving the composition of the owners is important for the business, such events are taken into account when the relationship is first formalized.

A corporate agreement is not subject to state registration. The participants who have entered into the agreement notify the company accordingly. In the cases provided for by law, information about the agreement is entered in the Unified State Register of Legal Entities or disclosed. A new version of the charter and transfers of interests are documented under their own rules.

An hourly rate, a fixed fee or a combined model is used; in some cases part of the fee depends on the outcome achieved. The fee is determined by the time actually spent, the complexity of the matter and the overall timeframe of the project, and is agreed before work begins.

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