Document background
The Business Acquisition Letter of Intent is a crucial preliminary document used in New Zealand business acquisitions to establish the fundamental terms and understanding between parties before proceeding with detailed due diligence and definitive agreements. It typically follows initial discussions and precedes the more detailed sale and purchase agreement. While generally non-binding, it demonstrates serious intent and commitment to the transaction process, outlining key terms such as purchase price, payment structure, exclusivity period, and conditions precedent. The document must comply with New Zealand legal requirements and commonly includes provisions addressing Commerce Act considerations, Overseas Investment Act implications (for foreign investors), and other relevant regulatory frameworks. It serves as a roadmap for the transaction and helps parties align their expectations before investing significant resources in the acquisition process.
