Case Study
NeosLegal Advises on $10M M&A Investment Deal in a UAE Web3 Startup
TL;DR:
NeosLegal advised a UAE-based Web3 company on a strategic equity investment transaction valued at over USD 10 million. Acting as long-standing counsel, we structured the deal to admit investor funding while preserving founder control, safeguarding token integrity, and ensuring regulatory compliance under UAE federal and free zone frameworks. The transaction was executed through a direct equity acquisition supported by a tailored ancillary shareholders’ agreement and marked the company’s first external capital event. The outcome reinforces the viability of sophisticated, founder-aligned investment structures in the region’s evolving virtual asset sector.
Client Objectives
NeosLegal has served as long-standing counsel to this UAE-based Web3 company, advising from inception through commercial maturity. Our mandate has covered the company’s entire legal foundation, including corporate structuring, intellectual property, and strategic regulatory advisory across multiple jurisdictions.
As the company achieved strong commercial traction and recurring revenues, a strategic investor sought to acquire a minority stake at a valuation exceeding USD 10 million. The founders wanted to formalise the investment while:
- Preserving founder control
- Protecting the governance framework
- Safeguarding the integrity of the token structure and underlying technology
The company’s first external equity deal was treated as a strategic inflection point, requiring a structure that admitted the investor as a shareholder with limited operational involvement, no board representation, all while remaining fully compliant under UAE corporate and free zone law.
UAE Regulatory Context
Although outside the scope of formal virtual asset licensing, the transaction engaged several layers of the UAE’s legal and regulatory framework:
- Federal law governing shareholder admission and rights
- Free zone corporate rules imposing procedural and documentary requirements
- Privately negotiated investment contract under common law, ensuring enforceability of investor rights and protections within internationally recognised legal standards
The UAE’s regulatory landscape remains dynamic, with varying levels of clarity across authorities. The deal required careful mapping to avoid unintended consequences or future constraints.
An additional challenge was aligning the investor’s expectations (based on common law investment norms) with statutory limitations in the UAE’s civil and free zone systems. Managing this divergence required both legal precision and strategic sensitivity.
NeosLegal’s Solution
NeosLegal led the structuring and execution of the transaction across legal, commercial, and regulatory dimensions:
1. Legal & Token Audit
We performed a comprehensive audit of the company’s corporate and token structures to identify potential risks or constraints.
2. Transaction Structure Design
The investor was admitted via direct equity acquisition, governed by an ancillary shareholders’ agreement tailored to preserve governance integrity and strategic autonomy. Investor rights were limited to information and basic protections without conferring control or decision-making powers.
3. Regulatory & Compliance Management
We ensured compliance with free zone requirements on share issuance, capital documentation, and registry approvals. All filings and consents were completed on time and in line with regulatory expectations.
4. Technology & IP Safeguards
We safeguarded founder-held assets and contractual protections around the company’s digital product environment, ensuring operational priorities remained intact.
5. Process & Execution
NeosLegal acted as lead interface throughout, managing formalities and ensuring seamless delivery within the agreed timeline.
Results and Outcomes
The transaction was completed smoothly, achieving:
- Formal admission of the investor under a founder-controlled structure
- Full compliance with UAE corporate and free zone frameworks
- Enhanced clarity around ownership and shareholder rights
- Zero disruption to operations or governance
Crucially, this was the company’s first external equity transaction at a valuation exceeding USD 10 million, a milestone that boosted credibility with investors and partners while setting a strong precedent for future fundraising or exit events.
Why This Matters
This case demonstrates the growing sophistication of investment activity in the UAE’s virtual asset sector. Even outside licensing regimes, high-value deals require nuanced legal structuring across corporate, commercial, and regulatory frameworks.
NeosLegal’s approach shows that investor-grade transactions can be structured to:
1
Protect founder control
2
Support scalable growth
3
Align with evolving Web3 market expectations
By bridging regulatory differences and anticipating long-term needs, we delivered a solution that was not only technically sound but strategically aligned with the company’s vision for future growth.
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Clients & Partners
Feedback & Endorsements
Juliet Su
Founding Partner
NewTribe Capital
“This partnership is about making sure founders aren’t left in the dark when it comes to legal questions. With NeosLegal’s support, we can offer more than funding. We can offer confidence.”
Alex Scott
Superteam UAE, Solana
“Having NeosLegal by our side means our founders building exciting Web3 projects with confidence and a solid legal foundation. We’re grateful for NeosLegal’s expertise, professionalism and commitment to helping the ecosystem grow.”
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