Sale and Leaseback
Category Contracts
Sale and leaseback is a financial transaction in which a company sells a property or asset to a buyer, and then immediately leases it back from the buyer. The company continues to occupy and use the property or asset, but no longer owns it.
This transaction is typically used by companies to raise capital while retaining the use of their property or asset. By selling the property or asset and leasing it back, the company is able to free up cash that was previously tied up in the asset, while still retaining the ability to use it for business purposes.
The terms of the leaseback agreement are negotiated between the buyer and the company, and typically include details such as the lease term, rent payments, and maintenance responsibilities. The leaseback may be structured as an operating lease or a finance lease, depending on the accounting treatment and tax implications.
Sale and leaseback transactions can be used for a variety of assets, including real estate, vehicles, and equipment. They are often used by companies in industries such as manufacturing, transportation, and retail, where there is a significant amount of capital tied up in fixed assets.
Overall, sale and leaseback transactions can be an effective way for companies to raise capital and manage their assets, while still retaining the ability to use them for business purposes.
If you need assistance in a sale and leaseback transaction contact us at
property@curriegroup.co.za
010 824 7275
Author: Johanvdw