Your Startup Just Got Acquired, What Happens To Your Team’s Visas?

Authored by Parvez Khan, Senior Immigration Associate and Compliance Officer at AY&J Solicitors 

For a founder, the day an acquisition completes feels like the finish line. The terms are agreed, the lawyers have done their work and the announcement is ready to go. For any startup that employs people on sponsored visas, however, it is also the start of a clock that few people in the deal room are watching.

Overseas buyers remain active in the UK. Foreign companies completed an estimated 244 acquisitions of UK companies in the last three months of 2025 alone, worth £33 billion, according to the Office for National Statistics. Many of the businesses they buy depend on international talent, and some of that talent is in the UK on a sponsored visa.

Each of those visas is tied to the employer’s sponsor licence. Under Home Office rules, that licence does not simply move across with the business.

“Founders spend months on due diligence and very little time on the sponsor licence,” says Yash Dubal, CEO of AY&J Solicitors, a London-based UK immigration law firm that advises employers on sponsor licences, Global Business Mobility and Skilled Worker visas. “Yet it is one of the few things in a deal that cannot simply be handed to the new owner. If it is overlooked, the people the buyer is paying for can lose their right to work in the UK.”

The Licence Does Not Travel With the Deal

The Home Office guidance for sponsors is clear on this point: sponsor licences are not transferable. When a business changes hands, whether through a full takeover, the sale of part of the business or a change in who owns it, the change must be reported through the Home Office’s online sponsorship system within 20 working days.

What happens next depends on how the deal is structured.

Where the startup remains the same company and only its owners change, the priority is to report the change correctly and on time. Where sponsored staff move to a different company, for example a UK entity in the buyer’s group, the position is more delicate. If that company does not already hold a suitable licence, it must apply for one within 20 working days of the move.

The good news is that, when the move is handled properly, the employees themselves do not need to apply for new visas, provided their duties stay the same. The bad news is what happens when it is not. If the new employer misses the deadline, or its application is refused, the Home Office guidance says the transferred workers’ permission to stay in the UK is cancelled.

Why 20 Working Days Matters

Twenty working days is four weeks. In the weeks after a deal closes, when teams are merging systems, payroll and reporting lines, four weeks passes quickly.

“The problem is rarely the law itself,” says Ikra Ahmed, a Senior Immigration Associate at the firm. “It is that nobody owns the task. HR assumes the lawyers on the deal will report the change, the deal lawyers assume HR will, and the deadline passes without anyone noticing.”
The Home Office is also more willing than ever to act. It revoked about 3,100 sponsor licences in 2025, the highest annual total since records began in 2012, according to its quarterly sponsorship statistics. Failing to report a change of ownership is one of the breaches that can lead to a licence being downgraded or revoked. If that happens, every sponsored worker in the business is affected, not only those involved in the deal.

A revocation can sometimes be reversed, but it is a costly route back. In one recent case, a care provider with more than 130 sponsored workers had its licence revoked. It was reinstated only after a formal legal challenge to the decision, and the business then had to commission a full compliance audit while it waited for the Home Office to look at the case again.

The Upside: A New Way To Bring People In

An acquisition does not only create risk. Once a startup becomes part of an overseas group, it gains access to a set of visa routes it could not use before.

The UK’s Global Business Mobility routes allow multinational groups to move existing employees between their companies. The most useful of these, the Senior or Specialist Worker route, lets the new parent company transfer its own people into the UK business for a temporary assignment. That could be an engineer who knows the buyer’s platform, or a manager sent to lead the integration.

The usual conditions apply. According to GOV.UK, the role must pay at least £52,500 a year, or the going rate for the job if that is higher. The employee must normally have worked for the group outside the UK for at least 12 months, unless they earn £73,900 or more. The UK company’s sponsor licence must also cover the route, which may mean adding it to an existing licence.

For an acquired startup, the work at this stage usually falls into three parts. The first is reviewing the existing Worker sponsor licence and the routes it covers. The second is reporting the change of ownership on the sponsorship system. The third is adding the Global Business Mobility routes, so that the new parent company can begin transfers. AY&J supports businesses through each of these steps, from the licence review to the first Senior or Specialist Worker applications.

Five Questions To Ask Before You Sign

The simplest protection is to treat the sponsor licence as part of due diligence, not as an afterthought. Before the deal completes, founders should be able to answer five questions.

• Which company holds our sponsor licence, and which visa routes does it cover?
• How many of our people are sponsored, and when do their visas end?
• Will the deal move any staff to a different company? If so, does that company already hold a suitable licence?
• Who will report the change, and by when? Name the person and put the 20-working-day deadline in the completion plan.
• Does the buyer plan to bring its own people to the UK? If so, which route fits, and is the licence ready for it?

An acquisition is the reward for years of work. Losing key people to a missed deadline is an avoidable way to spoil it. Put the sponsor licence on the deal checklist alongside the cap table and the intellectual property, and the team the buyer is paying for will still be in place on day one.

Parvez Khan is a solicitor and Senior Immigration Associate at AY&J Solicitors, where he is also the firm’s Compliance Officer. He has been with the firm since it was founded and advises businesses, individuals and families on UK immigration, including sponsor licences and complex cases.