Introduction to Joint Venture

A Joint Venture is a strategic business alliance in which two or more companies/parties, having a common purpose or objective join & compile their resources, expertise, technology, etc. to accomplish specific business objectives based on the business plan. Each participant is responsible for its profits, losses, risks, and costs in a joint venture. However, a joint venture is an entity that is different from the business interests of the participants or investors.

Why need Joint Venture Services?

Joint ventures can be referred to simply as partnerships. The joint ventures or partnerships can be of different structures viz., limited liability companies, partnerships, corporations, private limited companies etc.

There are many advantages to a joint venture consulting services, some of which have listed down below:

  • Investors and parties can offer new products and services.
  • It can help achieve operational efficiency and cost-saving.
  • It can help both involved parties save time.
  • It can assist parties to acquire new customers and expand to geographies covered by both companies involved in the partnership.
  • It can also enable parties to gain access to new technology.

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    Legal Conditions behind this Joint Venture

    Joint ventures are of two major types incorporated or unincorporated. Incorporated joint venture acquires a separate legal entity, perpetual succession and its rights and obligations, whereby it can sue and be sued. You can establish an unincorporated joint venture like a simple partnership firm governed by the joint venture agreement, which stipulates all nuances of the relationship, including the rights and obligations among the parties and with third parties.

    When drafting a joint venture agreement, it’s vital to clearly define what percentage of the partnership each partner will own. If they float a new corporation, it’s important to share a board of directors and equal shares of stock.

    The agreement also detailed how each will recover their share of profits and pay their losses. Once it’s signed, the parties are bound to abide by it, much like any other contract.

    How does BSP Freedo Help?

    BSP Freedo needs to understand the Joint Venture criteria, including product/ capabilities, quality of human capital, other essentials of an ideal JV partner (the target), through a strategy briefing session with the client’s management team. The knowledge gained in this session defines an extraordinarily detailed and focused search profile of the target.

    BSP Freedo conduct an in-depth economic, organizational, and market-specific scrutiny to draw up a target list that fits the client’s Joint Venture criteria. The initial list will be further narrowed down after screening the best and suitable possible targets.

    Top management of each shortlisted company will be approached to discuss and negotiate parameters. Each administration will have come with a specific targeted business plan. BSP Freedo will not disclose your identity to the shortlisted target unless they have shown willingness to discuss and have signed confidentiality agreements with, BSP Freedo. At this stage, BSP Freedo will share mutual presentations, carefully balancing the interests and intentions of the client.

    BSP Freedo prepare an Ideal target profile. It will carry weights and other grades against each shortlisted target. This will help your management pick up the final target. BSP Freedo will arrange for a visit by your operational team to the selected target companies and vice – versa. BSP Freedo arrange management presentations, as and when necessary, from the target companies to choose the ideal target.

    BSP Freedo assist in preparing the business plan and facilitating the financial/operational and legal due diligence once a non-binding Letter of Interest has been exchanged between the target and the client.

    BSP Freedo will prepare, facilitate, and participate in the negotiations between the client and the target company. BSP Freedo will broker a deal and ensure the final signature of the Joint venture agreement and the closing of the transaction.