ARE you looking to sell your business this year, or even in 2018? If so, you should speak to your lawyer now about getting your business ready for sale.
It can take a good year or more of preparation before your business is ready to sell, especially if you are looking to achieve the top sale price your business deserves.
If you are looking to sell right away, you may have to sell at a discount or offer your buyer post-sale guarantees as to the fitness of your business.
But if you actually take the time to prepare your business for sale, you could realise its full value simply because you have done the legal prep work to make the sale process easy and transparent.
So how can you best get your business legally fit to sell? Here are some tips to get you started.
- Collate your business paperwork – you need to be ridiculously thorough when it comes to ensuring your paperwork is in place. Make sure everything from your company registers to your health and safety certificates, and from your hire agreements to your property deeds are located, locked down and, if necessary, updated. Your buyer will want to see all these documents as part of its pre-sale checks, sometimes referred to as buy-side due diligence. Do not give your buyer an excuse to knock money off the sale price simply because of a missing piece of paper.
- Give your business a pre-sale health check – early preparation for sale can begin with a pre-sale check-up, sometimes referred to as sell-side due diligence. This check-up is often followed by corrective actions, such as sorting out contracts with customers, suppliers and employers, taking steps to protect your business’s intellectual property, or by hiving down some or all of your business’s assets into a fresh company.
- Think about the different ways you can sell your business – there are two common types of sale, a share-based deal (where the buyer purchases the shares in a company) or an asset-based deal (where the buyer purchases the assets and liabilities that make up the business). The legal and tax consequences of the two forms of sale are very different and you should find out which approach is the most cost effective and least administratively burdensome for both you and your buyer.
While there is no one size fits all approach to selling a business, careful preparation and sound early legal advice can certainly help any seller get the best possible price and smooth the formal sale process once you have a buyer lined-up.
For further help and advice on preparing your business for sale, contact Andrew Kerr at Wilson Browne Solicitors on 01604 876697 or email
