Document background
An Acquisition Letter of Intent is a crucial preliminary document used in the early stages of merger and acquisition transactions in Hong Kong. It serves as a roadmap for the proposed transaction, documenting the parties' initial understanding and setting expectations for the negotiation process. While primarily non-binding, certain provisions such as confidentiality and exclusivity are typically binding. The document is particularly important in Hong Kong's dynamic business environment, where it helps facilitate cross-border transactions and provides a framework for due diligence and subsequent negotiations. It typically includes key commercial terms, proposed timeline, and basic transaction structure, while leaving room for detailed terms to be negotiated in the definitive agreement. The document must comply with Hong Kong law and business practices, particularly considering the territory's role as a major international financial center.
