Onesto Legal · New Delhi
Buying into India, or partnering with someone already there, is the fastest route in and the one with the least margin for error.
We run diligence on the target, structure the transaction, draft and negotiate the documents, obtain the approvals and see it through to closing.
Most India joint ventures do not fail on strategy. They fail on governance and exit terms that were agreed in a hurry at the start, when both sides were optimistic and neither wanted to raise the awkward question.
The awkward questions are the work. We ask them early, in a document, while everyone is still friendly.
The problem
Every joint venture and every acquisition eventually meets a decision the parties see differently. What happens then was decided years earlier, in a clause nobody argued about.
Diligence on an Indian target is a different exercise from diligence in Europe. Title to land, undisclosed related party dealings, informal labour arrangements, pending tax and departmental proceedings, and licences held personally rather than by the company are the recurring findings.
None of these necessarily kill a deal. All of them change the price, the structure, or the indemnities, and all of them are cheaper to find before signature.
On the joint venture side, the failure pattern is consistent. A 50:50 shareholding with no deadlock mechanism, no reserved matters list, no agreed valuation method for an exit, and a non compete that does not survive the relationship.
Two years later one party wants to invest and the other does not, and there is no way through except a dispute. That outcome is written into the first draft or it is not.
What we handle
On the buy side and the sell side, and for joint ventures where nobody is buying anybody.
Commercial and reputational assessment of the counterparty before you spend money on diligence: who really controls it, how it is financed, what it is known for, and whether the people you have met are the people who decide.
Corporate records, title and leases, material contracts, licences and approvals, employment, litigation and tax exposure, related party transactions and intellectual property, reported by materiality rather than as a data dump.
Run with our chartered accountants: quality of earnings, undisclosed liabilities, tax positions taken, and the working capital and debt adjustments that will decide the final price.
Share purchase or asset purchase, level of ownership, treatment of the existing management, and the foreign investment route, valuation and pricing rules that apply to an inbound investor.
Term sheet, share purchase or subscription agreement, shareholders or joint venture agreement, business transfer agreement, escrow and non compete, drafted to be enforceable in India.
Competition clearance where thresholds are met, sectoral and government approvals where the route requires them, conditions precedent tracked to satisfaction, and completion mechanics executed properly.
The six that matter
What diligence finds
How it runs
Timelines are driven by diligence findings and by any regulatory approval required. A straightforward private acquisition can close in three to four months.
What you are trying to buy or build, what you already know, and where the commercial value sits, so diligence looks at what matters rather than everything.
Legal, financial and tax review run in parallel, with a findings report that separates deal breakers from price adjustments from post closing fixes.
Structure chosen on tax, regulatory and control grounds, then a term sheet that settles the hard points before the long documents are drafted.
Definitive agreements drafted and negotiated, with warranties and indemnities written against what diligence actually found.
Conditions precedent tracked, approvals obtained, completion executed, and post closing filings and integration steps completed rather than assumed.
Common questions
General guidance rather than advice on a particular matter. Requirements and timelines change, and sector rules vary.
A share purchase buys the company with everything in it, including liabilities you did not find. An asset purchase lets you take the business and leave the history behind, but it is slower, attracts different tax and stamp duty, and licences and contracts usually need to be transferred or reissued rather than coming with the assets.
Where diligence turns up material tax or litigation exposure, an asset purchase is often the way a deal survives it.
Corporate records and shareholding, title to land and leases, material customer and supplier contracts, licences and approvals, employment arrangements including contract labour, litigation and departmental proceedings, tax positions, related party transactions and intellectual property.
The findings that change deals most often are land title, undisclosed related party dealings, and employment classification.
Yes. Inbound investment by a non resident into an Indian company is subject to pricing guidelines, with a floor based on a valuation carried out under a prescribed methodology by a qualified valuer.
This constrains structuring more than most European buyers expect, and it is worth establishing early because it affects the whole negotiation.
Only where the transaction crosses prescribed asset or turnover thresholds, which are calculated on the combined position of both parties and their groups, including assets and turnover outside India.
Where it applies, clearance is a condition to closing and has to be built into the timetable rather than treated as a formality at the end.
A private acquisition with cooperative diligence and no regulatory approval typically runs three to four months from mandate to closing. Where competition or government approval is required, add to that.
The variable that moves the date most is how quickly the target produces documents, which is why we set the request list and the deadline at the start.
The diligence is lighter and the documentation is heavier, because you are agreeing how to live together rather than how to hand something over. The shareholders agreement is the deal.
The other difference is exit. In an acquisition, exit is the transaction. In a joint venture, exit is a clause you will one day rely on, so it deserves the argument now rather than later.
Yes, provided the shareholders agreement gives you protection that does not depend on your shareholding: reserved matters requiring your consent, board representation, information rights, anti dilution, and a defined exit.
A minority stake with none of those is not an investment. It is a loan with no repayment date.
Onesto Legal
Onesto Legal is the in-house legal practice of Onesto Management Consultancy, operating from our New Delhi office. The people who advise are the people who act.
Legal Head
Heads the practice from New Delhi, with day to day conduct of corporate, regulatory and contentious matters.
Advocate
Advocate and founder of Onesto Management Consultancy. Doctoral candidate in International Law at the University of Deusto, Bilbao.
Advocate
Advocate, co-founder and director. Doctoral candidate in International Law at the University of Deusto, Bilbao.
Related
The shareholders agreement and the commercial contracts that sit under it.
Read more →The joint venture vehicle, incorporated and structured.
Read more →Financial diligence, and the entity’s numbers after you own it.
Read more →Finding and verifying the counterparty in the first place.
Read more →Write to us
Even an early conversation is worth structuring properly, because the term sheet is where most of the value in a deal is won or lost. Send us what exists and we will tell you what is missing from it.
We answer from New Delhi and from Bilbao, so European clients are not waiting a day for a reply.
Onesto Legal, Onesto Management Consultancy
New Delhi, India and Bilbao, Spain
The Bar Council of India does not permit advertisement or solicitation by advocates. This page is published for general information about the areas in which Onesto Legal practises and is made available on the basis that the reader has sought it out of their own accord. Nothing here is legal advice, and reading it does not create a lawyer and client relationship. Statutory requirements, thresholds and timelines change, and any reference to a rule, a form or a period is a general description rather than advice on a particular matter.