Document background
The Acquisition Letter of Intent is a crucial preliminary document used in the early stages of a potential business acquisition or merger. It serves as a roadmap for the transaction and demonstrates serious intent while allowing parties to maintain flexibility before final commitments. Under Australian law, this document typically includes both non-binding commercial terms and binding provisions such as confidentiality and exclusivity. It's commonly used after initial discussions but before detailed due diligence and definitive agreements. The LOI helps parties align their expectations, establish transaction parameters, and create a framework for negotiations while ensuring compliance with Australian corporate and competition laws. It's particularly important in complex transactions or when dealing with foreign investors where FIRB considerations may apply.
