Introduction: Should a Foreign Investor Buy the Shares or the Assets of a Turkish Company?

A foreign investor planning to acquire a business in Turkey usually faces one of the most important decisions in the transaction at a very early stage:

Should we buy the shares of the Turkish company, or should we buy only its business and assets?

The answer can fundamentally change the buyer’s exposure to:

• historical debts;
• tax liabilities;
• Social Security Institution (SGK) debts;
• employees;
• litigation;
• customer contracts;
• bank debt;
• licences;
• real estate;
• intellectual property;
• regulatory approvals;
• and hidden liabilities.

A share deal means that the investor purchases shares in the existing Turkish legal entity.

The company remains the same company after closing.

Only its ownership changes.

An asset deal, by contrast, generally involves purchasing selected assets or an operating business from the company rather than becoming the shareholder of the company itself.

This distinction sounds simple, but its legal consequences are significant.

In a share deal, historical liabilities usually remain inside the target company. If a foreign investor purchases 100% of a Turkish company that later receives a substantial tax assessment relating to a period before closing, the company still has to deal with that liability.

An asset acquisition may allow the buyer to select the assets it actually wants and leave certain unwanted liabilities with the seller.

However, an asset deal is not automatically liability-free.

Turkish law contains important successor-liability mechanisms.

Article 202 of the Turkish Code of Obligations provides that a person acquiring a business or pool of assets together with its assets and liabilities can become responsible to creditors for the transferred business debts after the relevant notification or announcement. The former debtor also remains jointly liable for a statutory two-year period.

Likewise, where a workplace or part of a workplace is transferred, Article 6 of the Turkish Labour Law generally transfers existing employment contracts to the purchaser with their rights and obligations. The transferor and transferee may also be jointly liable for certain pre-transfer employee debts, while the transfer itself does not constitute a valid reason to terminate employment.

SGK legislation can create additional successor liability.

For these reasons, foreign investors should not reduce the analysis to:

Share deal = risky.

Asset deal = safe.

The correct question is:

Which structure provides the best balance between liability protection, operational continuity, tax cost, regulatory requirements and the assets the foreign investor actually wants to acquire?

This comprehensive 2026 guide compares share and asset acquisitions under Turkish law and explains which structure may be safer for different types of foreign investment.

1. What Is a Share Deal in Turkey?

In a share deal, the purchaser buys some or all of the ownership interests in an existing Turkish company.

For example:

Before closing

Seller: 100% shareholder of Target A.Ş.

After closing

Foreign Investor: 100% shareholder of Target A.Ş.

The legal entity itself does not disappear.

Target A.Ş. continues to own the same:

• machinery;
• bank accounts;
• real estate;
• receivables;
• intellectual property;
• contracts;
• licences;
• employees;
• liabilities;
• and litigation.

Its taxpayer identity and legal history also continue.

Turkey permits foreign investors to acquire shares in existing Turkish companies, and the Ministry of Trade’s guidance recognises share acquisition as a normal route for foreign investment.

This continuity is simultaneously the principal advantage and the principal risk of a share deal.

2. What Is an Asset Deal?

In an asset transaction, the purchaser generally acquires specific business assets rather than shares in the company that owns them.

Depending on the transaction, the purchaser may acquire:

• machinery;
• stock;
• vehicles;
• intellectual property;
• customer relationships;
• contracts;
• real estate;
• business names;
• domain names;
• equipment;
• lease rights;
• certain employees;
• or an entire commercial enterprise.

Turkish Commercial Code Article 11 recognises that a commercial enterprise may be transferred as a whole without requiring a completely independent transfer transaction for every business element. Unless otherwise agreed, the transfer is presumed to include elements such as fixed assets, enterprise value, tenancy rights, trade name, intellectual property rights and other assets permanently allocated to the business. A contract transferring the commercial enterprise as a whole must be in writing and registered and announced through the Trade Registry.

However, transactions structured as selective asset purchases rather than the transfer of an entire commercial enterprise require a more asset-specific analysis.

3. Why Do Buyers Often Prefer Asset Deals?

From the buyer’s perspective, the strongest argument in favour of an asset acquisition is the possibility of selectivity.

A foreign investor may want:

the factory, customer contracts, trademark and equipment

but not:

historical shareholder disputes, unrelated subsidiaries, questionable receivables and old litigation.

A selective asset transaction can potentially allow the buyer to acquire the commercially valuable components without buying the equity of the company that accumulated the historical problems.

This is particularly attractive where the target has:

• uncertain tax history;
• litigation;
• shareholder disputes;
• significant bank debt;
• historic related-party transactions;
• employee problems;
• or unclear accounting.

However, the buyer must determine whether the transaction truly constitutes a selective purchase of specific assets or whether Turkish law will characterise it as a transfer of an operating business or workplace with statutory successor consequences.

The label printed on the SPA is not always decisive.

4. Why Do Sellers Usually Prefer Share Deals?

Sellers often prefer share sales for the opposite reason.

A seller transferring 100% of the shares can potentially exit the entire business structure in one transaction.

The buyer acquires the company with its:

• assets;
• liabilities;
• employees;
• contracts;
• licences;
• and operating history.

From the seller’s perspective, this can create a cleaner commercial exit.

Of course, the seller may remain contractually liable through:

• warranties;
• indemnities;
• tax covenants;
• escrow;
• or deferred consideration.

But operationally, the seller no longer owns the target company.

An asset transaction may be less attractive to a seller if valuable assets are transferred while problematic liabilities remain behind in a company that the seller must later liquidate or restructure.

This difference in incentives explains why negotiations over share deal versus asset deal can become one of the first major issues in an M&A transaction.

5. Historical Liabilities: The Biggest Share Deal Risk

The central disadvantage of a share deal is historical liability exposure.

Imagine a foreign investor acquires 100% of a Turkish manufacturing company.

Six months later, the tax administration conducts an audit concerning transactions carried out two years before the acquisition and assesses significant:

• corporate tax;
• VAT;
• penalties;
• and interest.

The buyer did not cause the problem.

But the target company is still the same taxpayer.

Therefore, it must defend and potentially pay the assessment.

The share sale has not reset the company’s history.

The same principle applies to:

• historical employee claims;
• SGK liabilities;
• supplier lawsuits;
• product liability;
• regulatory investigations;
• data protection violations;
• environmental liabilities;
• bank obligations;
• and contractual disputes.

This is why legal, tax and financial due diligence is critical in a share acquisition.

6. Buying an A.Ş. and Buying an Ltd. Şti. Do Not Carry the Same Public-Debt Risk

The distinction between a Turkish joint stock company and limited company is particularly important.

For an A.Ş., ordinary shareholders are generally not personally responsible for company debts merely because they own the shares. The company is responsible with its own assets.

The foreign investor still suffers economically if the acquired company has substantial historical debt, but the shareholder itself does not ordinarily become personally liable for every company debt solely because of the acquisition.

The position is more serious with an Ltd. Şti.

Under Article 35 of Law No. 6183, limited company shareholders can be pursued in proportion to their capital shares for qualifying public receivables that cannot be collected from the company. The current GİB collection guidance confirms the proportional shareholder-responsibility framework.

This can make a share acquisition of an Ltd. Şti. materially more sensitive than the acquisition of an A.Ş.

7. A New Ltd. Şti. Shareholder Can Face Historical Public Debt Exposure

This is one of the most important issues for foreign investors.

A purchaser acquiring an interest in a Turkish Ltd. Şti. cannot automatically say:

“Any public debt before the closing date belongs exclusively to the old shareholder.”

Article 35 contains specific share-transfer rules concerning public receivables.

Accordingly, the timing of the share transfer and the period to which the public debt relates must be carefully analysed.

The practical result is clear:

If the target is an Ltd. Şti., tax and SGK due diligence should be substantially more rigorous before a foreign investor acquires its shares.

A private SPA can give the purchaser contractual recourse against the seller.

It cannot necessarily eliminate statutory rights that Turkish public authorities may have under public receivables legislation.

8. Does an Asset Deal Completely Protect the Buyer From Historical Debts?

No.

This is probably the most important misconception concerning asset acquisitions.

Turkish Code of Obligations Article 202 provides that a person acquiring a pool of assets or enterprise with its assets and liabilities becomes responsible toward creditors for the debts of that business from the relevant notification or announcement.

The old debtor remains jointly liable with the acquirer for two years. For debts already due, the period runs from the notification or announcement; for debts falling due later, it begins from maturity. If the required notification or announcement is not made, the two-year period does not begin.

Therefore, an asset deal structured as a transfer of the entire operating enterprise can produce liability succession.

A buyer should not assume that putting the words:

“Asset Purchase Agreement”

at the top of the document automatically avoids Article 202.

9. A Genuine Selective Asset Purchase Can Still Be Safer

Despite the Article 202 issue, a properly structured selective asset acquisition can often provide better liability isolation than a share deal.

For example, a buyer might purchase:

• specified production machinery;
• a trademark;
• inventory;
• certain contracts;
• and a particular property.

The agreement may clearly identify which assets are included and which liabilities are not being assumed, subject to mandatory law.

This can reduce exposure to liabilities attached purely to the seller’s legal entity.

However, each asset must be reviewed separately.

Some rights or obligations may require:

• third-party consent;
• regulatory approval;
• registry formalities;
• employee transfer analysis;
• or payment of taxes.

Therefore, the safer liability profile may come at the cost of a more complicated closing process.

10. Employees Make Asset Deals More Complicated

A share deal usually causes no change in the identity of the employer.

Assume:

Before acquisition: Target A.Ş. employs 80 people.

Foreign Investor buys all shares.

After acquisition: Target A.Ş. still employs the same 80 people.

Only Target A.Ş.’s shareholder changed.

In an asset or workplace transfer, however, the employer can change.

Article 6 of the Turkish Labour Law provides that when a workplace or part of a workplace is transferred through a legal transaction, employment contracts existing on the transfer date pass to the new employer with their rights and obligations.

The purchaser must recognise service periods by reference to the employee’s original commencement date with the transferor when determining rights based on length of service.

This means a buyer cannot necessarily say:

“We are buying the factory but all employees start from zero seniority tomorrow.”

Turkish labour law generally prevents that result.

11. Pre-Transfer Employee Debts Can Also Follow the Workplace

Labour Law Article 6 further provides that the transferor and transferee are jointly responsible for certain debts that arose before the transfer and were due at the date of the transfer.

The transferor’s responsibility for those obligations is generally limited to two years after transfer.

Therefore, employment due diligence in an asset deal should investigate:

• unpaid wages;
• overtime;
• annual leave;
• bonuses;
• employee benefits;
• collective agreements;
• pending employee litigation;
• severance exposure;
• and incorrect payroll practices.

The fact that the buyer is not acquiring shares does not eliminate employee-related risk where the transaction amounts to a workplace transfer.

12. Employees Cannot Be Dismissed Merely Because the Business Was Sold

Article 6 also states that neither the transferor nor the transferee may terminate employment solely because the workplace or part of it has been transferred.

The transfer itself does not constitute a valid reason for employee termination. Rights to terminate for legitimate economic, technological or organisational reasons remain subject to ordinary labour law rules.

This is important for foreign purchasers planning post-acquisition restructuring.

If the commercial plan is:

“We will buy the business through an asset deal and terminate all employees on closing day,”

the labour law consequences should be analysed before signing.

13. SGK Liability Can Also Follow a Workplace Transfer

Social security adds another layer.

Where the transaction constitutes a transfer of an insured workplace, Turkish SGK legislation can impose statutory responsibility on the new employer for historical premium-related obligations in the circumstances prescribed by law.

SGK’s own legal literature identifies Article 89 of Law No. 5510 as the provision dealing with responsibility of an employer acquiring a workplace and explains the broader statutory policy of increasing the persons from whom public social security receivables may be recovered.

Therefore, a foreign purchaser considering an asset transaction should conduct a separate SGK due diligence, particularly where a labour-intensive operating business is being transferred.

An asset deal is not a safe harbour for unpaid social security premiums.

14. Contracts Are Easier to Preserve in a Share Deal

This is one of the strongest advantages of a share acquisition.

In a share transaction, the company that signed the contract remains the same legal person.

Therefore, customer and supplier contracts ordinarily continue without a formal assignment merely because the shareholder changes.

However, contracts may contain change-of-control clauses requiring:

• notification;
• consent;
• renegotiation;
• or giving the counterparty termination rights.

These provisions must therefore still be reviewed.

But in general, operational continuity is easier than in an asset acquisition.

15. Asset Deals Can Require Contract-by-Contract Assignment

In an asset deal, customer and supplier agreements may need to be transferred to the buyer.

That can create a major closing challenge.

Suppose the target’s value depends primarily on 50 customer agreements.

If each contract requires the customer’s written consent before assignment, the purchaser may need dozens of approvals.

A customer could use the opportunity to:

• demand a lower price;
• change payment terms;
• refuse transfer;
• or terminate the commercial relationship.

Therefore, the buyer should identify key contracts and verify assignment requirements before determining that an asset deal is preferable.

A transaction that is legally safer from a historical-liability perspective may be commercially useless if the buyer cannot obtain the contracts that generate the revenue.

16. Licences and Regulatory Permissions Often Favour Share Deals

Many licences are issued to a particular legal entity.

For example, regulated businesses may operate under:

• healthcare licences;
• energy licences;
• financial permissions;
• payment licences;
• operating certificates;
• environmental permits;
• tourism documentation;
• or municipal licences.

In a share deal, the licence holder generally remains the same company, although change-of-control rules may require regulator notification or prior consent.

In an asset deal, the licence may not be transferable at all.

The purchaser may have to make an entirely new application.

This can make a share deal the only commercially practical structure in certain regulated sectors.

Therefore, regulatory due diligence should answer:

Does the licence survive a share transfer?

Does change of control require approval?

Can the licence be transferred in an asset deal?

Would the purchaser need a new licence?

These questions should be answered before the acquisition structure is selected.

17. Intellectual Property May Be Easier in a Share Deal

Where the target company owns:

• trademarks;
• patents;
• source code;
• domain names;
• software;
• designs;
• or other intellectual property,

those rights remain owned by the same company following a share transaction.

No asset-level assignment is ordinarily necessary merely because the shareholder changes.

In an asset transaction, each intellectual property right should be identified and properly transferred.

Different rights may require different documentation and registry procedures.

The buyer should also establish whether the company actually owns the IP or merely licences it.

Technology acquisitions often fail due diligence not because there is no valuable software, but because the legal chain of ownership is incomplete.

18. Real Estate Transfers Add Formalities to Asset Deals

A target may own valuable:

• factories;
• warehouses;
• offices;
• land;
• apartments;
• or development property.

In a share deal, the registered owner remains the Turkish target company.

No separate title transfer occurs simply because the company’s shares change hands.

In an asset deal, the real estate itself must be transferred to the buyer through the legally required title process.

The buyer should then conduct property-specific due diligence concerning:

• title ownership;
• mortgages;
• attachments;
• zoning;
• easements;
• court restrictions;
• permits;
• occupancy status;
• and environmental matters.

Asset purchases involving real estate can therefore be significantly more document-intensive.

19. Asset Transfers Can Trigger More Individual Transfer Formalities

The same principle applies to other assets.

Depending on what is being acquired, separate procedures may be necessary for:

• real estate;
• vehicles;
• trademarks;
• domain names;
• licences;
• receivables;
• bank accounts;
• contracts;
• registered machinery or security interests.

By contrast, a share acquisition can transfer indirect economic control of all company assets through a single ownership transaction.

This is why a share deal is often operationally faster.

The buyer effectively purchases the legal “container” holding the business.

The problem is that the container also holds its liabilities.

20. Tax Can Produce Very Different Economics

The choice between share and asset transactions should always be tax-modelled before the purchase price is fixed.

The Turkish Revenue Administration’s 2026 Corporate Tax Guide confirms that qualifying participation-share gains may benefit from an exemption: under the current rules, 50% of qualifying gains from participation shares held for at least two full years can be exempt from corporate income tax where the statutory conditions are satisfied.

The treatment of individual asset disposals is different.

A company selling:

• machinery;
• inventory;
• intellectual property;
• real estate;
• or other assets

must analyse corporate tax and, depending on the asset and transaction, VAT and other tax consequences individually.

The Revenue Administration confirms that commercial deliveries of assets can fall within VAT and that special exemptions apply only where statutory requirements are satisfied.

Accordingly, a seller may prefer a share deal because the tax result is more favourable.

A buyer may prefer an asset deal because of liability protection.

This creates a classic M&A negotiation issue:

The structure that is safest for the buyer may be less tax-efficient for the seller.

Purchase price negotiations frequently reflect this difference.

21. Asset Deals May Give the Buyer a Better Acquisition-Cost Basis

From an economic and accounting perspective, an asset deal may enable the purchaser to acquire specific assets at negotiated acquisition values, with tax depreciation or amortisation consequences depending on the asset.

In a share deal, the buyer’s cost generally sits in the acquired participation interest rather than automatically stepping up the tax basis of each asset held inside the target.

This can make asset acquisitions attractive in certain structures.

However, the tax consequences should be modelled with Turkish tax advisers because different classes of property are subject to different depreciation, VAT, transfer and corporate tax treatment.

A legal structure should not be chosen solely on a simplified tax assumption.

22. Competition Authority Approval Can Apply to Either Structure

Foreign investors should not assume merger-control rules apply only to share acquisitions.

Turkish merger control focuses significantly on control.

An asset acquisition can therefore become notifiable where acquisition of the relevant business/assets results in a lasting change of control and the turnover tests are satisfied.

Turkey updated its merger-control legislation in February 2026.

The Competition Authority increased key thresholds, including increasing the former TRY 250 million threshold to TRY 1 billion, the former TRY 750 million Turkish turnover threshold to TRY 3 billion, and the former TRY 3 billion worldwide turnover threshold to TRY 9 billion.

The Authority also published updated merger and control guidelines in May 2026.

Therefore, before closing either a share or business acquisition, the investor should determine whether Competition Authority clearance is a condition precedent.

23. A Minority Share Deal May Still Create Control

Merger-control analysis does not depend solely on acquiring more than 50% of the shares.

A foreign investor might acquire only 40% but receive veto rights over matters such as:

• budget;
• business plan;
• major investments;
• senior management;
• strategic commercial decisions.

Those rights could potentially create joint control depending on their nature.

Likewise, purchasing a particular business division through an asset deal may constitute acquisition of control over an undertaking even without purchasing a legal entity.

The correct analysis is therefore:

What control is acquired?

not merely:

How many shares or physical assets are purchased?

24. Due Diligence Is Required in Both Structures—but the Scope Is Different

It would be incorrect to conclude:

“An asset deal means we do not need due diligence.”

Due diligence remains necessary.

The difference is focus.

In a Share Deal

The buyer should investigate the entire company because it is acquiring ownership of the legal entity.

In an Asset Deal

The investigation focuses heavily on:

• title to purchased assets;
• liens;
• transferability;
• contracts;
• employees;
• business succession;
• SGK;
• licences;
• intellectual property;
• real estate;
• and statutory successor liabilities.

The diligence may be narrower in some areas but deeper in relation to specific assets and transfer mechanics.

25. Which Structure Is Safer if the Company’s Historical Accounting Is Unreliable?

From a buyer’s risk perspective, a selective asset deal will often deserve serious consideration.

Suppose due diligence shows that the target:

• cannot produce reliable tax records;
• used questionable invoices;
• has poor payroll records;
• engaged in extensive related-party transactions;
• and is currently subject to tax inspection.

Buying 100% of that legal entity means inheriting economic exposure to that history.

A selective asset acquisition may allow the investor to purchase only clearly identified valuable assets and establish a clean acquisition vehicle.

However, the investor must still test whether:

• TBK Article 202 applies;
• the transaction constitutes a workplace transfer;
• SGK successor liability arises;
• creditor-protection rules apply;
• and the assets are genuinely free of liens.

Asset structure is a risk-management tool, not a magic eraser.

26. Which Structure Is Safer if the Business Depends on Licences and Long-Term Contracts?

A share deal may be safer operationally.

Consider a Turkish healthcare business with:

• valuable regulatory permissions;
• a long-term hospital lease;
• dozens of insurance agreements;
• hundreds of employees;
• and specialist supplier contracts.

Attempting to move all of these elements into a new purchaser entity may be commercially difficult or legally impossible.

If the existing legal entity holds all critical permissions, the buyer may prefer to acquire its shares and manage historical risk through:

• intensive due diligence;
• warranties;
• tax indemnities;
• escrow;
• holdback;
• and price adjustment.

In M&A, “safer” therefore depends on what risk the investor is trying to minimise.

27. Which Structure Is Safer for a Technology Startup Acquisition?

The answer depends on the startup’s history.

A share deal may be efficient because the target company already owns:

• software;
• employees;
• domains;
• customer contracts;
• SaaS subscriptions;
• personal data;
• and investor agreements.

However, the investor should conduct careful due diligence into:

• IP chain of title;
• founder rights;
• employee-created software;
• open-source usage;
• KVKK;
• foreign cloud transfers;
• tax;
• option arrangements;
• and shareholder rights.

If the company’s corporate or tax history is severely problematic but one particular technology asset is valuable, an asset acquisition of the IP and selected contracts may be preferable.

Again, the commercial viability of assignment must be confirmed.

28. Share Deals Usually Preserve Business Continuity Better

For an operating company, the share transaction can often be closed with less disruption.

The same company continues to:

• invoice customers;
• employ staff;
• operate bank accounts;
• own assets;
• hold leases;
• use permits;
• and maintain existing commercial relationships.

This can be a decisive advantage.

The buyer can effectively change the ownership “above” the operating entity without rebuilding the operating infrastructure.

For a business where continuity is essential, share acquisition may therefore provide substantially greater commercial certainty.

29. Asset Deals Can Give the Buyer a Cleaner Starting Point

The principal advantage of an asset acquisition is the possibility of placing selected assets into:

a new or existing buyer-controlled Turkish company

with a cleaner corporate history.

The purchaser can potentially start with:

• its own governance;
• its own accounting policies;
• its own bank relationships;
• new financing;
• selected employees;
• and selected commercial assets.

This can be attractive for investors acquiring a distressed business.

However, the buyer must ensure that the transaction does not unintentionally leave behind the operational rights necessary to make those assets valuable.

A factory without:

• employees;
• environmental permit;
• customers;
• software;
• raw material contracts;
• or access rights

may be worth much less than the buyer expected.

30. Distressed Company Acquisitions Require Special Care

Where the seller or target is facing:

• enforcement;
• insolvency;
• restructuring;
• concordat;
• substantial unpaid tax;
• or creditor pressure,

the share-versus-asset analysis becomes even more important.

An unusually cheap asset transfer immediately before insolvency can also generate creditor and avoidance risks.

The buyer should investigate:

• whether assets are attached;
• whether creditors hold security;
• whether the seller has authority to transfer;
• whether the transaction could later be attacked;
• and whether payment should be made directly to secured creditors.

A low purchase price does not necessarily mean a safe bargain.

31. Contractual Protection Is Essential in a Share Deal

Because the buyer acquires the company’s history, the Share Purchase Agreement should generally contain a comprehensive liability framework.

The SPA may regulate matters including:

• title to shares;
• accounts;
• tax;
• SGK;
• employees;
• litigation;
• material contracts;
• IP;
• real estate;
• licences;
• data protection;
• compliance;
• anti-corruption;
• environmental liability;
• and undisclosed debt.

Known problems should usually receive specific indemnities, rather than being left only to general warranties.

For significant historical risks, buyers may also require financial security.

32. Escrow and Holdbacks Can Make a Share Deal Much Safer

Suppose tax due diligence identifies a possible TRY 50 million exposure.

The buyer can still decide to purchase the shares.

But instead of paying the entire purchase price directly to the seller, the transaction could include:

purchase price: EUR 20 million
paid at closing: EUR 17 million
escrow: EUR 3 million

If the identified tax risk later crystallises, the buyer may have a realistic source of recovery.

Without escrow, the buyer may possess an excellent indemnity against a seller who has already moved the proceeds abroad.

Legal rights and practical recoverability are not the same thing.

33. Asset Purchase Agreements Also Need Warranties

An asset transaction is not documentation-light.

The buyer should obtain protection concerning issues such as:

• seller’s ownership of assets;
• absence of liens;
• transferability;
• condition of equipment;
• IP ownership;
• inventory;
• environmental status;
• permits;
• employee liabilities;
• taxes relating to transfer;
• contracts;
• and creditor claims.

The purchaser should also define exactly which:

assets are assumed

and

liabilities are excluded or assumed, subject to mandatory statutory liability rules.

A poorly drafted asset schedule can create serious disputes after closing.

34. Share Deal vs Asset Deal: Practical Comparison

35. Practical Example: Foreign Investor Buying a Turkish Manufacturing Company

Assume a foreign industrial group wants to acquire a Turkish manufacturer for EUR 25 million.

The target has:

• 180 employees;
• factory real estate;
• environmental permits;
• export contracts;
• intellectual property;
• machinery;
• bank financing;
• and ten years of operating history.

Due diligence reveals some uncertain historical tax exposure.

Share Deal Option

The buyer acquires 100% of Target A.Ş.

Advantages:

The factory, employees, contracts, licences and IP stay in the same legal entity.

Operational interruption is minimal.

Risk:

Historical tax and other liabilities remain inside the company.

Possible solution:

Detailed tax indemnity, escrow and purchase price adjustment.

Asset Deal Option

The buyer purchases the factory, equipment, IP and operating business.

Advantages:

The buyer may avoid acquiring some corporate-level history.

Risks:

Real estate must be transferred.

Employees may transfer under Article 6.

SGK successor issues must be assessed.

Contracts require review.

Permits may need transfer or reapplication.

TBK Article 202 may apply depending on the scope of the business transfer.

In this scenario, a share deal could still be commercially preferable despite historical tax risk because continuity is extremely valuable.

36. Practical Example: Buying a Troubled Turkish Ltd. Şti.

Assume a foreign investor is considering 100% of a Turkish Ltd. Şti.

The company owns:

• a valuable trademark;
• an e-commerce platform;
• customer database;
• and inventory.

But its records reveal:

• historic tax uncertainty;
• SGK arrears;
• multiple employee cases;
• shareholder disputes;
• and questionable accounting.

In this situation, buying the shares can be particularly risky because the legal entity contains substantial historic exposure and limited company public-debt rules can create additional shareholder concerns.

The investor may instead consider purchasing only:

• the trademark;
• domain;
• software;
• selected inventory;
• and selected transferable contracts

into a clean acquisition vehicle.

But the buyer must still determine whether the transaction amounts to transfer of an enterprise or workplace under mandatory Turkish rules.

This is an example where an asset deal may be substantially safer—but only if carefully structured.

37. Can the Buyer Change From a Share Deal to an Asset Deal After Due Diligence?

Yes, and this is relatively common in transaction planning.

An investor may initially negotiate a share acquisition.

Legal due diligence then reveals excessive historic risk.

The parties can potentially restructure the transaction into an asset acquisition.

Likewise, due diligence may reveal that critical licences cannot be transferred, causing an originally proposed asset transaction to become a share deal.

Therefore, the acquisition structure should not always be treated as irreversible before due diligence is complete.

An effective Letter of Intent can preserve flexibility.

38. Should the Letter of Intent State Share Deal or Asset Deal?

Ideally, yes, but it can also state that the final structure remains subject to:

• legal due diligence;
• tax due diligence;
• regulatory analysis;
• and tax structuring.

A foreign buyer should avoid becoming unconditionally committed to purchasing the shares before understanding what sits inside the company.

Similarly, the seller should know whether the buyer intends to purchase the whole company or only selected assets.

The two structures can produce dramatically different economic outcomes for both sides.

39. Which Structure Is Generally Faster?

A share deal is often operationally faster where the target is already a functioning business.

The company itself stays intact.

Asset transactions can require numerous transfers and consents.

However, the corporate share transfer itself may have formalities depending on the target type.

The Ministry of Trade confirms, for example, that Ltd. Şti. transfers generally involve a written/notarised share transfer agreement, shareholder approval unless the articles provide otherwise, and Trade Registry registration and announcement. A.Ş. transfers are ordinarily more flexible and generally are not individually registered and announced in the same manner.

Accordingly, even within share deals, an acquisition of an A.Ş. and acquisition of an Ltd. Şti. should not be treated identically.

40. So Which Is Safer: Share Deal or Asset Deal?

There is no universal answer, but there is a useful general principle.

From a Buyer’s Historical-Liability Perspective

A properly structured selective asset deal is often safer, because the investor can potentially choose what it acquires and avoid taking ownership of the seller’s legal entity and its entire corporate history.

But the buyer must still analyse:

• TBK Article 202;
• Labour Law Article 6;
• SGK successor liability;
• creditor rights;
• individual asset liens;
• tax;
• and regulatory transfer rules.

From an Operational Continuity Perspective

A share deal is often safer, because:

• contracts remain with the same company;
• employees remain with the same employer;
• assets do not need individual transfer;
• licences may remain valid;
• bank accounts continue;
• and customer relationships can be preserved.

If the Target Is an Ltd. Şti. With Uncertain Public Debts

An asset structure often deserves particularly serious consideration because a share acquisition can create additional public-debt exposure under Turkish limited-company rules.

If the Target Is Highly Regulated

A share deal may be more practical if critical licences are not transferable, provided change-of-control approvals are obtained and historical liabilities are contractually protected.

If the Target Has Clean Due Diligence

A share deal may be the simplest and most commercially efficient route.

If the Target Has Serious Historic Problems but Valuable Specific Assets

A selective asset acquisition may be substantially preferable.

Frequently Asked Questions

What is the difference between a share deal and asset deal in Turkey?

In a share deal, the buyer purchases ownership interests in the company itself. In an asset deal, the buyer purchases specified assets or an operating business.

Is an asset deal always safer for a foreign investor?

No. It can provide better protection against entity-level historical liabilities, but Turkish rules on business transfer, employees, SGK and creditor succession may still transfer certain liabilities.

What happens to old debts in a share acquisition?

They generally remain liabilities of the same Turkish company because the company’s legal identity does not change.

Does buying shares in an A.Ş. make the buyer personally liable for every company debt?

Generally no solely because of shareholder status, although the buyer owns a company whose value can be affected by those debts.

Is buying an Ltd. Şti. more risky?

It can be. Turkish public receivables legislation contains special proportional liability rules for limited company shareholders.

Can an asset buyer become liable for business debts?

Yes in certain structures. TBK Article 202 provides that a person acquiring an enterprise or pool of assets with its assets and liabilities can become responsible to creditors, while the prior debtor remains jointly responsible for a statutory period.

Do employees automatically transfer in an asset deal?

Where the transaction qualifies as transfer of a workplace or part of a workplace, existing employment contracts generally transfer automatically with their rights and obligations under Labour Law Article 6.

Can employees be dismissed simply because the business is sold?

The transfer itself does not constitute a valid reason for termination under Article 6.

What happens to contracts in a share deal?

The contractual party generally remains the same company, but change-of-control clauses should be reviewed.

What happens to contracts in an asset deal?

Assignment may require counterparty consent depending on the contract and applicable law.

What happens to licences?

In a share deal, licences generally remain with the same legal entity, although ownership changes can require regulatory approval. In an asset deal, some licences may need transfer or a completely new application.

Which transaction is more tax-efficient?

It depends on the seller, assets, holding periods and transaction. Current 2026 tax guidance provides a 50% corporate-tax exemption for qualifying participation share sale gains meeting the statutory requirements, while asset disposals require asset-specific corporate tax and VAT analysis.

Can Competition Authority approval apply to an asset deal?

Yes. Turkish merger control concerns changes in control, and acquisition of a business or relevant assets can require approval when the applicable conditions and turnover thresholds are met.

Conclusion: What Is the Safest Way for a Foreign Investor to Buy a Turkish Company?

The choice between a share deal and an asset deal is one of the most important legal decisions in a Turkish acquisition.

Neither structure is automatically superior.

A share acquisition offers one major commercial advantage:

continuity.

The foreign investor acquires the company as it exists.

Its employees, contracts, licences, assets, intellectual property and operational infrastructure normally remain within the same legal entity.

For a functioning Turkish business with valuable licences, established customer agreements and a clean history, this can make a share transaction the most efficient acquisition structure.

But continuity has a cost.

The company also carries forward its:

tax history + SGK history + litigation + employee claims + regulatory exposure + contractual liabilities + compliance problems.

For this reason, a foreign investor buying shares should assume that due diligence is not optional.

The acquisition agreement should then convert due diligence findings into contractual protection through:

warranties + indemnities + purchase price adjustment + escrow + holdback + conditions precedent.

The risk is especially important when the target is an Ltd. Şti., because Turkish public receivables law contains additional proportional shareholder-liability rules.

An asset acquisition offers a different strategy.

It can allow the purchaser to select the commercially valuable parts of the business while avoiding ownership of the original legal entity.

Where a Turkish company has a problematic tax or corporate history but owns specific valuable assets, this can be a major advantage.

However:

An asset deal does not mean “no liabilities.”

TBK Article 202 specifically regulates the acquisition of an asset pool or enterprise with its assets and liabilities and can impose creditor liability on the purchaser. The former debtor remains jointly liable during the statutory period.

Employees create another mandatory-law issue.

If the transaction constitutes transfer of a workplace or part of one, Labour Law Article 6 transfers existing employment contracts to the purchaser with their rights and obligations and creates joint liability for certain historical employee receivables.

SGK successor liability must also be independently reviewed.

The same is true for:

• contracts;
• licences;
• intellectual property;
• real estate;
• regulatory permissions;
• and tax.

Accordingly, the buyer should generally think about the two structures as follows:

Share deal: easier operational transfer, greater historical entity risk.

Asset deal: potentially better liability isolation, greater transfer complexity and mandatory successor-liability risk.

For a foreign investor, the safest decision-making process is therefore:

identify the commercial assets that create value → conduct preliminary due diligence → identify historical liabilities → analyse licences and contracts → analyse employee and SGK consequences → analyse tax → analyse merger control → compare share and asset structures → negotiate the transaction model → conduct full due diligence → build contractual protections → close only after conditions precedent are satisfied.

A foreign purchaser should particularly resist making the acquisition structure decision solely on the basis of what the seller proposes.

The seller and buyer usually have different interests.

The seller may prefer a share sale because it can dispose of the entire corporate vehicle.

The purchaser may prefer selected assets because it wants to minimise exposure to the seller’s history.

The final structure should reflect:

risk allocation, not convenience alone.

In practical terms, a selective asset acquisition will frequently be safer where:

• historic accounting is unreliable;
• major public debts are suspected;
• shareholder disputes exist;
• only a few assets are commercially valuable;
• or the target is an Ltd. Şti. with questionable tax history.

A share acquisition will frequently be more practical where:

• due diligence is satisfactory;
• contracts are difficult to assign;
• operating licences are critical;
• the workforce must remain uninterrupted;
• real estate and IP are already correctly held by the target;
• or operational continuity is central to the investment.

The decisive question is therefore not:

“Is an asset deal safer than a share deal?”

It is:

“Which liabilities are we trying to avoid, which assets and rights must continue after closing, and which Turkish-law obligations will follow the business regardless of how the agreement is labelled?”

That question should be answered before the foreign investor signs the acquisition agreement.

A sophisticated buyer does not simply choose between shares and assets.

It first maps:

what it wants to own, what it refuses to inherit, what cannot legally be left behind and what must be protected through the purchase price and transaction documents.

That is ultimately the safest way to acquire a business in Turkey.

This article reflects Turkish corporate, obligations, employment, tax and competition legislation and publicly available official guidance as of August 2026. It is intended for general informational purposes only and does not constitute transaction-specific legal, tax, employment, SGK or investment advice. The appropriate acquisition structure should be determined according to the target company’s legal form, liabilities, workforce, licences, contracts, tax position, assets and the commercial objectives of the foreign investor.