Scenario: a foreign fund wants 100% of the company owning an operating wind farm — “buy the company, done”. But legal due diligence finds: annually-paid leased land whose mortgagee bank hasn’t consented to transfer, a PPA with change-of-control clauses, and the operation license in the old company’s name. Power M&A: buy right and it’s fast; buy wrong and you “hold” decade-long risk.
Two deal structures: share deal vs asset deal
Share deals: acquiring the project company — licenses, PPA, land contracts stay with the company, fewer conversion procedures. Asset deals: transferring individual assets and contracts — more complex but “cleaner” when the target has bad debts or disputes. For operating projects, share deals dominate since PPAs and licenses are preserved.
Conditions for investment-project transfer
Under investment law (Investment Law 143/2025/QH15, replacing Law 61/2020/QH14 from 1 March 2026), investors may transfer investment projects when: the project is not terminated or revoked; land financial obligations are fulfilled; and the transferee meets investment conditions. Amending the Investment Registration Certificate for the new investor is mandatory.
Legal due diligence: 5 key risk groups
- Land: remaining lease term, rent fully paid, mortgaged land and bank consent to transfer.
- PPA: change-of-control clauses — is EVN’s prior consent needed.
- Licenses: electricity operation license validity and ownership-change conditions.
- Financing: loans, security, bank commitments — which covenants change-of-control breaches.
- Environment, disputes: EIA, environmental licenses, community land disputes, pending claims.
Regulators’ and third parties’ roles
Many project contracts (PPAs, loan agreements, conditional land leases) require prior consent of counterparties on ownership change. Skipping consent is the most common error — the deal signs but the PPA is declared breached and loans accelerated.
Frequently asked questions
1. Share deal or asset deal for power projects?
Operating projects usually use share deals to preserve PPAs and licenses; asset deals are more complex but cleaner for distressed targets.
2. What conditions apply to project transfers?
Project not terminated/revoked; land financial obligations fulfilled; transferee meets investment conditions; IRC amendment.
3. Does changing project ownership need EVN’s consent?
Depends on PPA change-of-control clauses — many require the buyer’s prior consent.
4. What does power-project due diligence focus on?
Land, PPA, licenses, loans/security, environment and existing disputes — the 5 risk groups setting deal value.
5. What rights do financing banks have on ownership change?
Per credit agreements: prior-consent rights, even loan acceleration if change-of-control breaches covenants.
This article has been quality-reviewed by the FLAW AI Legal Council.