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Importance of Business Deal

Business deals are basically agreements between the various parties that indulge in commercial activities with each other. The business deals contain the various details of the transactions between the parties that are executing the business. There are several types of business deals – the most common type of business deal is the merger and acquisition. As per this type, one company buys a certain portion of or the total company itself.

One of the most important parts of the business deal in case of mergers and acquisitions is determining the share of buyer in the company where he is investing. In case of mergers, two or more companies combine their operations in order to fulfill certain purpose – be it getting a bigger share of the market or increasing the client base. In case of the acquisitions, the buyer gets the total or certain share of the company. In case of the acquisitions, a crucial part of the business deal is determining the percentage of ownership.

In case the business deal is taking place between companies from two different countries, the factor of foreign direct investment also comes into play. In this case the business deals take on a different dimension. They have to be formulated in a way so that the laws of investment and other relevant issues are well looked after. These deals also need to be mindful of the operative tax structure and figure out ways in which the whole exercise could be tax effective. As far as the small businesses are concerned, negotiations form an important part of their business deals.

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