Selling your business is likely to be the most important step you are likely to ever take. So before you start the process you should consider the following:
Buying a competitor business is going to be equally as challenging and much thought needs to be given as to the team you build. If the proposed venture is Â£5,000 or Â£50,000,000, like it or not but lawyers are an essential requirement for the smooth running of the transaction.
Your team of professional advisers is very important to ensure that you get a good deal which is done as quickly and as painlessly as possible. This is a long process and, whilst you may be attracted by the lowest fees that you can find, in our experience, receiving low quotes from professionals is an indication that either they do not necessarily know what they are doing or that they are giving you unrealistic expectations and will either try to up the fees at a later stage.
You should also ensure that the advisers you instruct are capable of working together. In this respect you should look for chemistry, not just between yourself and your advisers but between your respective advisers themselves. It is extremely important that the deal is properly project managed by people experienced in these deals to ensure that every person that is involved knows what he or she is doing and the deadlines that they are facing.
Share or Asset Sale
There are numerous considerations to be taken into account when deciding whether it is in your best interests to sell the shares in your company or whether it is preferable to sell off business assets. Any decision on whether to sell the business assets or the shares will depend entirely on your individual circumstances. The seller will usually want to sell the business as a whole while the buyer would prefer to pick and choose the parts of the business they would like to buy.
Value of Your Business
As the Royal Mail sale showed there is no magic formula for valuing your business. A seller should have the business valued prior to selling the business, as well as have a bottom figure they are willing to accept. While there are certain models and methods you can consider, these are merely indications of how much the business is worth and a business is only worth what the buyer is willing to pay.
Prior to starting the transaction you should ensure adequate safe guards are also in place, such as confidentiality agreements, data protection compliance, as well as an appropriate plan should the transaction collapse.