Legal 101: Things you learn from the Korean Drama “Start-Up”
Legal 101: Acquisition Agreement Lessons from the Korean Drama “Start-Up”
Korean drama series often reflect real business risks. In the drama “Start-Up,” young entrepreneurs build a technology company with the support of an accelerator. What appears to be a success story quickly becomes a legal warning about acquisition agreements and corporate control.
For startups and business owners, the key lesson is clear: never sign an acquisition agreement without proper legal review.
Understanding Acquisition, Merger, and Consolidation
In the series, a global company expresses interest in the startup’s technology. Instead of offering an investment, the company proposes an acquisition.
An acquisition is a corporate action distinct from merger or consolidation.
• In a merger, two companies combine into one surviving entity.
• In consolidation, both entities dissolve and form a new company.
• In an acquisition, one company takes control of another, often through share transfer.
Unlike mergers, acquisitions often lead to a change in control. The acquiring company may gain full authority over management decisions, strategy, and leadership appointments.
In Indonesia, corporate actions such as mergers and acquisitions are regulated under Company Law and related regulations issued by the Ministry of Law and Human Rights.
The Legal Risk of Signing Too Quickly
In the drama, the acquisition agreement is signed one day after being received. There is no visible legal review process.
Shortly after signing, the startup’s CEO is removed by the acquiring company.
This is not unrealistic.
A poorly reviewed acquisition agreement may include:
• Control transfer clauses
• Forced resignation provisions
• Share dilution terms
• Non-compete restrictions
• Management restructuring rights
Without proper review, founders may unintentionally give away decision-making authority.
Why Acquisition Agreement Review Is Critical
An acquisition agreement is not merely a funding document. It determines:
• Ownership structure
• Voting rights
• Board control
• Intellectual property ownership
• Exit rights
A qualified lawyer reviews:
• Whether control provisions are balanced
• Whether termination clauses are fair
• Whether valuation terms are transparent
• Whether dispute resolution mechanisms are appropriate
Startups often focus on capital needs. However, legal structure determines long-term survival.
Startup Legal Risks in Indonesia
Startups operating in Indonesia must consider:
• Company structure (PT or PT PMA)
• Shareholder agreements
• Foreign ownership limitations
• Regulatory compliance
• Tax implications
If you are establishing or restructuring a company, review our Corporate & Commercial Law services:
Commercial Law
If you are facing disputes arising from corporate control or shareholder conflict, see:
Dispute Rresolution Non Litigation
Practical Advice Before Signing Any Agreement
Whether you are:
• Receiving investment
• Entering partnership
• Accepting acquisition
• Signing a shareholder agreement
Do not rush.
Economic pressure, including situations such as the COVID-19 downturn, may push entrepreneurs to accept quick deals. However, speed without legal clarity increases risk.
Before signing:
Request sufficient time to review the agreement.
Conduct legal due diligence.
Clarify control and voting rights.
Understand termination clauses.
Seek professional legal advice.
Speak With a Corporate Lawyer in Bali
If you are negotiating an acquisition, merger, or shareholder agreement in Indonesia, consult a qualified lawyer before signing.
Yuna Law Firm assists entrepreneurs, foreign investors, and startups in reviewing acquisition agreements and protecting corporate control.
Contact Yuna Law Firm here:
Contact Bali Lawyer
Early legal review prevents long-term business damage.
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