Mergers and acquisitions in Thailand can take the following forms:

• Amalgamation
• Merger
• Acquisition of shares
• Acquisition of assets

Some transactions involve a combination of these structures. For instance, the transaction may begin with a share acquisition, followed by an amalgamation or a merger between two companies, or an entire or partial business transfer from the target company to the buyer.

Auctions are becoming more common, especially for businesses likely to attract a lot of interest from buyers. Indicative bid process letters are commonly used at the first offer stage.

Mergers and amalgamations are considered to be complex and relatively time-consuming compared to the acquisition of shares or assets.

Under Thai law, once two or more companies are amalgamated, the amalgamating companies will cease to exist and a new company will be established by operation of law. This new company will inherit all of the assets, liabilities, rights, duties and obligations of the amalgamating companies.  A major drawback of an amalgamation is that the new company loses the opportunity to treat the tax losses brought forward by the amalgamating companies as an expense when computing net profit for tax purposes.

A merger under Thai law refers to a transaction where a company (Company A) merges with another company (Company B), and one company (either Company A or Company B) survives the merger while the other ceases to exist. The surviving company will assume all assets, liabilities, rights, obligations and responsibilities of the other company by operation of law. Although the concept was introduced in 2023, there is only one tax ruling issued by the Revenue Department regarding the tax treatment of a merger. Apart from this, there are no regulations or guidance issued by the Revenue Department.

The nature and form of limited liability companies in Thailand are essentially the same as in many other jurisdictions. The capital is divided equally and is represented by shares at a designated (par) value. The liability of each shareholder is limited to the unpaid portion of the shares held. Limited liability companies may be either private companies, which are subject to the Civil and Commercial Code of Thailand, or public companies, which are subject to the Public Limited Company Act.

There are two types of limited liability companies: a private limited company and a public limited company.

There must be at least two shareholders for a private limited liability company. There is no maximum number of shareholders.

In a share acquisition, both the buyer and the acquired entity (the target) survive, but the buyer becomes a shareholder of the acquired entity (the target). Any transfer of ownership in shares is valid and effective against the transferor and transferee only if it is evidenced by a duly executed share transfer instrument in the form required under Thai law. The transfer will be valid against the company and any third party only if the details of the transfer are recorded in the share register book.

In an asset acquisition, both the acquiring entity (the buyer) and the selling entity (the seller) survive the acquisition. The seller merely divests its assets or business(es) and transfers them to the buyer. After completion of the transaction, whether the seller is dissolved or maintained to carry out different business activities is a matter to be considered separately from the acquisition. For an asset sale and purchase, the transfer of certain assets may require compliance with the relevant formalities.