Change of Control
Definition
A change of control occurs when ownership of a company passes to a new party, as it does on an acquisition. The term matters in M&A because many of a business's contracts contain change-of-control clauses that are triggered by the sale: a customer or supplier contract, a lease, a licence or a loan may allow the other party to renegotiate or terminate if the company changes hands. These clauses can affect the value a buyer is really acquiring — revenue that can walk away on completion is worth less than revenue that is locked in — so identifying them is a core part of due diligence. A concentration of change-of-control triggers, especially in key customer contracts, is a common finding that reshapes price, earn-out or the warranties a seller must give. Sellers reduce the risk by understanding their contracts early and, where possible, securing consents before completion.
Complementary Terms
Concepts that frequently appear alongside Change of Control in practice.
The comprehensive investigation and analysis of a business prior to an investment, acquisition, or partnership. Due diligence covers financials, legal, commercial, technical, and operational areas, and increasingly includes assessment of intangible assets and productivity metrics.
A 100-day plan is the structured programme an acquirer follows in the first roughly three months after completing an acquisition to stabilise the business and begin realising the value it paid for. It sequences the priorities: securing the key people and customers, communicating with staff, connecting essential systems and controls, and starting on the synergies that justified the deal — without disrupting what already works.
Further Reading
Acquisition Due Diligence: The Operator's Checklist
How change-of-control clauses are found and priced in diligence.
Read more →Related FAQ
What is acquisition due diligence?
Acquisition due diligence is the structured verification of what you are buying — financial, legal, commercial, tax, people and, crucially, the intangible assets that make up most of the value — before you commit.
Read full answer →Put this knowledge to work
Use Opagio's free tools to measure and grow the intangible assets that drive your business value.