Dissolving a company through a merger before the end of the year?
Dissolving a company through a merger - be sure to make the necessary decisions and notify the Swedish Companies Registration Office
A merger involving a wholly owned subsidiary usually takes about three months
A merger can be a good solution and an alternative to liquidation when your company has one or more subsidiaries that are no longer seen as needed. If the merger can be registered before the close of the next annual accounting period, you avoid the need to prepare annual financial statements for the merged companies.
In the merger of a wholly owned subsidiary, all of the subsidiary’s assets and liabilities are taken over by the parent company. At the same time, the subsidiary is dissolved without the need for liquidation and its assets and liabilities are absorbed by the parent company. The process takes about three months, including notification to creditors.
Make decisions and create a merger plan
The board in the parent company and the board in the subsidiary or subsidiaries decides on a merger and establishes a joint plan with the terms for the merger. ‘Once the shareholders approve the joint merger plan, it takes effect.
The merger plan must always be reviewed by an authorised or approved auditor, and this requirement applies to all companies participating in the merger, regardless of whether they have a designated auditor.
The application for permission to dissolve the company through a merger and the notification procedure for the company’s creditors
Once the shareholders have signed on to the merger plan and the plan takes effect, the parent company must immediately apply for permission to implement the merger plan.
The Swedish Companies Registration Office officially notifies the subsidiary’s creditors in the Post- och Inrikes Tidningar (Swedish government newspaper) with a notice period of two months. If the company’s auditors assess that there is a risk that the parent company’s debtors may not be paid, the Swedish Companies Registration Office also posts a notification for the parent company’s debtors.
If no creditors respond by the end of the notification period, the Swedish Companies Registration Office may grant permission to implement the merger plan and the subsidiaries are thereby dissolved.
Please feel free to contact us so we can help you make the necessary decisions and notify the Swedish Companies Registration Office in good time!
We help you with:
- Merger plan with a board of director’s report
- Board resolution
- Board certification
- Notification to the Swedish Companies Registration Office
- Project management, communication with authorities and auditors
There are often tax-related issues to consider during mergers concerning the group contribution and the right to utilise the subsidiary's tax loss. In addition to providing assistance with the merger, Accountor can offer tax advice for a planned merger.
Of course, we also offer advice and assistance with regard to bookkeeping and accounting for the merger.