Legal Structure: Acquisition of a GmbH vs. an UG for International Business Buyers

Legal Structure: Acquisition of a GmbH vs. an UG for International Business Buyers

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Kiran Bibi Broker Asked 1 month ago
For international business buyers, what are the advantages and disadvantages of acquiring a German GmbH versus an UG (mini-GmbH)?
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3 Answers

Acquiring a German GmbH offers credibility, higher capital base, and easier access to financing, but involves higher purchase and maintenance costs. An UG (mini-GmbH) requires less capital and is simpler to set up, yet may face credibility issues and stricter profit retention rules, making growth slower.
N Answered by Neil Walter | 1 month ago
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For international buyers, a GmbH offers strong credibility, limited liability, and easier access to bank financing, making it ideal for established businesses, but it requires a higher minimum share capital (€25,000). A UG (mini-GmbH) is cheaper to start (€1 minimum capital), quicker to set up, and allows testing a new market, but it can feel less stable to partners, may face banking hurdles, and often needs to retain profits until it builds equity. Emotionally, choosing between them is about balancing security and credibility versus speed and affordability the GmbH feels solid and reassuring, while the UG feels agile but requires careful management to gain trust.
M Answered by M.Arham | 4 weeks ago
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A GmbH offers stronger credibility with banks, suppliers, and customers, and allows easier access to financing, but requires higher share capital and setup costs. An UG (mini-GmbH) is more affordable and quicker to establish, making it attractive for first-time or smaller acquisitions. However, UGs may face trust and funding limitations until they build capital and convert to a GmbH.
K Answered by Kamran Ali | 2 weeks ago
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