Asset sale and safe harbor plan

Let’s say company A is a related and participating employer in Plan X which is a safe harbor plan with the basic match formula.  Company A is purchased mid 2024 in an asset sale so all employees will be terminated from Company A. They have a distributable event. If the buyer has their own 401k plan that is not safe harbor, are there any spin off options mid year for that portion of Company X plan that is attributable to employees of A? Do we have safe harbor  concerns where we should suggest a spin off as of end of plan year in order to not violate 2024 safe harbor status.
Thank you for any comments!

If this is an asset sale, I wouldn't generally advise the Buyer to acquire the Plan. In my experience, the Buyer in an asset sale isn't interested in acquiring the Seller's plan (or portion of the Seller's Plan) anyway because the Buyer would assume all liabilities of the Plan (even liabilities incurred prior to the sale). I think the simplest solution is to amend the Buyer's Plan to allow the newly acquired employees to either become eligible as of a certain date (for example, a a date shortly after the sale date), or at the very least permit rollovers prior to participation. You could also choose to credit service with the Seller's Plan, after which crediting, many of the acquired employees may then satisfy the Buyer's eligibility requirements. 

And no, I do not believe the Seller's plan loses it's Safe Harbor status due to the asset sale, as a spin-off would be in connection with a merger or acquisition. However, if you were to decide to spin-off the Seller's assets and merge the plans, merging a Safe Harbor Plan (or a portion thereof) into a non-Safe Harbor Plan mid-year is questionable. There isn't any formal guidance on such mid-year mergers. If you merged the plans mid-year, conservatively, I would say at a minimum the portion of the plan spun-off loses its Safe Harbor status for 2024.