Distinction on takeover
In an acquisition, a distinction must be made between (i) an equity transaction and (ii) an asset (liability) transaction. In the first case, the shares of the company are transferred to the buyer and the buyer will become the new shareholder of the company. In the second case, instead of the shares in the company, certain assets (e.g. all or part of the IP rights and/or IP licenses and related corporate assets) of the company are transferred to the acquirer.
Acquisition of IPR licences in asset transactions
When licences are acquired as part of an asset transaction, the contracts are taken over. In that case, the selling and buying parties need the cooperation of the licensor. This cooperation can take place before or possibly after the takeover. If the licence is not transferable, there will in principle not be a legally valid transfer unless the IP right holder in question gives his consent to the transfer of the licence.
Acquisition of IP licences in share transactions
In the case of a share transaction, the contractual relationship between the licensee and the licensor does not in fact change. After all, the company (licensee) only acquires another shareholder, but continues to exist itself. The consequence of this is that also the licence (agreement) remains unchanged. There is no contract takeover or transfer of intellectual property rights, which means that the possible non-transferability of the licence does not prevent the intended takeover. In principle, therefore, no cooperation is required from the licensor in the case of a share transaction. This is different, however, if the licence agreement contains a so-called "change of control"' provision, according to which the licence agreement ends immediately in the event of a transfer of shares from the licensee, unless the licensor still agrees to the intended change in shareholders.
In short: In order to determine the legal position of the company in an acquisition with respect to intellectual property rights, it is wise to examine intellectual property rights and licenses (or have them examined) properly. In the case of licenses, it will be necessary in particular to carefully examine whether there are any contractual restrictions with regard to takeovers and/or changes.
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