Document background
The Acquisition Letter of Intent (LOI) is a crucial preliminary document used in the early stages of business acquisitions in Pakistan. It serves as a formal expression of interest from a potential buyer to a seller, outlining the basic terms and structure of the proposed transaction. While predominantly non-binding, except for specific provisions such as confidentiality and exclusivity, the LOI helps parties establish a clear understanding before proceeding with detailed due diligence and definitive agreements. This document is particularly important in the Pakistani business context, where it helps align parties' expectations and can be used to secure initial regulatory approvals or financing commitments. The LOI must comply with Pakistani corporate and contract laws, including the Contract Act 1872 and Companies Act 2017, and often serves as a reference point for subsequent negotiation of the final purchase agreement.
