What each structure actually means
An asset sale and a share sale are two ways to sell the same business, and they move different things. In a share sale the buyer acquires the shares in your company. The company itself does not change: it keeps its name, its contracts, its employees, its bank accounts, its history and its liabilities, and simply has a new owner. You receive the proceeds personally for your shares and, in most cases, step away from the entity entirely.
In an asset sale the buyer does not buy the company. They buy chosen assets out of it, such as equipment, stock, goodwill, intellectual property, customer relationships and specific contracts, together with whatever liabilities the two sides agree the buyer will take on. The legal entity stays with you. After completion you are left holding the company, any assets and liabilities that were not part of the deal, and the sale proceeds, which sit inside the company until you extract them.
The distinction matters most in what stays behind. A share sale transfers the business whole, including the parts neither side has found yet, such as an old dispute or an underpaid tax. An asset sale lets the buyer take the good and decline the rest, which is precisely why the two sides often want different things.
When each one fits
A share sale tends to fit when the company is clean and well run: tidy accounts, clear ownership of assets, contracts and permits that would be awkward to reassign, and no material hidden liabilities a buyer would fear inheriting. For you as the seller it is usually the cleaner exit, because the whole entity leaves your hands in one step and the residual liabilities go with it. It is also often, though not always, the more favourable structure for you personally on tax, which is one reason sellers push for it.
An asset sale tends to fit when the buyer wants only part of what you own, when the company carries history or liabilities they will not accept, or when the value sits in transferable assets like equipment, a brand or a customer book rather than in the entity itself. It is usually the buyer’s preferred route, because they can ring-fence risk and, in many countries, improve their own tax position on the assets acquired. The trade-off for you is a messier aftermath: contracts and permits may need reassigning with third-party consent, and you are left with a company to wind down and proceeds to draw out.
In practice the structure is negotiated, and it interacts with price. A buyer taking on more risk in a share sale may pay less or ask for stronger warranties and indemnities; a buyer getting the safer asset structure may pay more but hand you the tidying up. It is rarely a decision either side makes alone.
The nuance to take advice on
The single largest variable here is tax and legal treatment, and it is the one you should not settle from general reading. How each structure is taxed, whether liabilities and employees transfer by default, what consents a transfer of contracts requires, and how the proceeds reach you personally all differ by country and change over time. The same deal can be markedly better under one structure than the other purely because of where your business and the buyer sit, and the efficient answer for you may be the costly one for the buyer.
So treat the choice as a modelling exercise, not a preference. Before you agree a structure, have a local corporate tax adviser and a lawyer run both options for your specific situation and jurisdiction, including what actually lands in your pocket after tax and what you are left holding afterwards. The structure often moves the real value of a deal as much as the headline price does, which is why it is worth getting right early rather than conceding late.