Home
/ Insights
/ Articles
/ Key Operational Considerations To Ensure Business Continuity in a Change of Control Transaction

Key Operational Considerations To Ensure Business Continuity in a Change of Control Transaction

Ensuring Continuity and Mitigating Risk in Change of Control Transactions

This article was originally published by AIRA in September 2025. The publication is available at: https://aira.org/pdf/journal/2025_v38_n3.pdf#page=28

Change of Control Transactions (“CCTs”) are increasingly common as lenders acquire distressed businesses through debt-for-equity swaps, Chapter 11 proceedings or Section 363 sales. These transactions can significantly alter ownership and management, making business continuity a critical priority. To manage a transition effectively, organizations must evaluate contracts, particularly those with change of control provisions that allow counterparties to terminate agreements. The risks vary depending on whether the transaction is structured as an equity sale or an asset sale, with bankruptcy processes providing greater flexibility for renegotiation.

Operational considerations span legal entity structures, perimeter definitions, strategic changes, regulatory and tax implications, financing and shared services. Leaders should address practical issues such as contract assignments, banking, insurance, real estate, intellectual property access and workforce onboarding. Communication planning and Day 1 readiness checklists are also essential to reduce disruption.

A centralized transaction team can coordinate activities, separate one-time from ongoing requirements and quantify costs and risks. Proactively identifying challenges and aligning operating models with new ownership strategies enables organizations to maintain stability and position themselves for future success.

This framework offers a practical starting point for executives, lenders and advisors navigating the complexities of a CCT. By focusing on operational readiness and contractual obligations, organizations can safeguard continuity and support their strategic and financial objectives.

Reprinted with permission from AIRA Journal