How a business is structured affects almost everything that comes later: which investors will back it, how much tax it pays on profits and exits, whether its licences survive a change of ownership, how easily it can expand into new countries, and how it is passed on or sold. Structures that grew by accident, or were copied from another company, often create problems that only surface during fundraising, due diligence or a sale.
We help founders, family businesses, growing companies and international groups choose the right structure, set it up properly in Nigeria and abroad, and keep it compliant. We work with trusted local counsel in other jurisdictions and coordinate the whole project, so clients have one team in charge.
Structures we advise on
| Structure | When it is used | Key considerations |
|---|---|---|
| Nigerian holding company | Groups with several Nigerian businesses or licensed subsidiaries | Regulatory approvals, group governance, tax on dividends |
| Delaware or other US holding company | Startups raising from US investors and accelerators | Flip mechanics, IP location, cost of two entities |
| UK holding company | Businesses with UK or European investors or customers | Tax treaties, substance, UK filing obligations |
| Other African or Middle East hubs | Regional groups and businesses expanding across Africa or into the Gulf | Licensing, tax, foreign exchange and local presence |
| Foreign subsidiary or branch | Nigerian businesses entering a new country | Local incorporation, licences, employment and tax |
| Joint venture abroad | Entering a market with a local partner | Control, exit and dispute resolution |
Choosing the right structure
There is no single right answer. We help clients weigh:
- the investors they plan to raise from and what those investors require
- where customers, staff, intellectual property and management are located
- tax on profits, dividends, interest, royalties and future exits, including transfer pricing and the rules on foreign subsidiaries
- regulatory licences that need approval for a change of ownership or control
- foreign exchange rules for bringing money into and out of Nigeria
- the cost of setting up and running each entity, and the substance each jurisdiction expects
- succession, asset protection and how the business will eventually be sold or passed on
Holding companies and group structures
As a business grows, it often makes sense to put a holding company above its operating companies, separating different businesses, licensed activities, property and intellectual property, and making it easier to bring in investors at the right level. We set up Nigerian and foreign holding companies, move existing businesses under them, and put in place the intercompany agreements and group governance that make the structure work. Some regulated businesses, such as banks and payment companies with several licensed activities, are required to use specific holding company structures.
For families, we combine group structures with succession planning for family businesses and private wealth structuring.
Delaware flips and offshore holding companies
A flip restructures a startup so that a foreign holding company, often a Delaware corporation, owns the Nigerian operating company, and founders and investors hold shares in the holding company instead. Some international investors and accelerators prefer or require this structure. A flip is not always necessary, it has costs, and some startups are now moving back to Nigerian holding structures.
Executing a flip
- Incorporating the holding company with foreign counsel
- Exchanging shares in the Nigerian company for shares in the holding company
- Regulatory approvals and CAC filings for the change in ownership
- Transferring or licensing intellectual property between the entities, with NOTAP registration where required
- Intercompany service, licence and loan agreements
- Capital importation by the holding company so that funds can later be repatriated
After the flip, the Nigerian company remains fully subject to Nigerian law. It must file annual returns, comply with transfer pricing rules on intercompany transactions and maintain its licences. Flips usually happen around a fundraising round or ESOP implementation, which we coordinate so that everything aligns.
Expanding outside Nigeria
Nigerian businesses increasingly expand into other African markets, the United Kingdom, the United States and the Middle East. There is generally no automatic "passport" that lets a Nigerian company or licence operate in another country, so each market needs its own entity, registrations and, in regulated sectors, its own licences. Regional frameworks can help: for example, a single licence from the central bank of the West African Economic and Monetary Union can cover several francophone West African countries, and the African Continental Free Trade Area is reducing barriers to trade in goods and services across the continent.
We help Nigerian businesses expand by:
- choosing between a subsidiary, branch, joint venture or partnership in each market
- coordinating company registration, tax registration and licensing with local counsel
- advising fintechs and other regulated businesses on licences in each target market
- structuring the funding of foreign operations and the flow of profits back to Nigeria
- preparing intercompany, distribution and franchise agreements; see franchising and distribution agreements
- secondments of Nigerian staff abroad and hiring local teams
- protecting trademarks in each new market
Coming into Nigeria
Foreign companies setting up in Nigeria face the reverse questions: whether to operate through a subsidiary, a branch exemption or a partner, and how to meet foreign investment, immigration and sector rules. See setting up a business in Nigeria and our joint ventures service.
Keeping the structure working
- intercompany agreements for services, IP licences, loans and cost sharing
- transfer pricing documentation, in coordination with our tax advisory team
- group governance, board composition and company secretarial support across entities
- regular reviews as the business, the law and tax rules change
Where an existing group needs to be reorganised, merged or simplified, see corporate restructuring.
How we help
- designing the structure around your investors, markets, tax position and long-term plans
- setting up holding companies in Nigeria and abroad
- carrying out Delaware flips and reverse flips
- expanding into new countries with subsidiaries, branches and joint ventures
- intercompany agreements, transfer pricing and group governance
- coordinating foreign counsel, tax advisers and regulators in one project
Our corporate and commercial lawyers in Lagos and Abuja advise founders, family businesses and groups on structuring and expansion. To discuss your structure or expansion plans, contact us.
