Retention Accounts

Retention accounts – what’s the point?

June 2015 In some acquisitions the buyer will not want to pay all the money up front. It may be worried about some potential liability of the seller arising under an indemnity or warranty in the purchase agreement. It won’t want to take the risk of the seller going bust before any claim is finally resolved, which could be many years after completion. So it will want to hold some money back until this risk goes away. But...