Buying or selling a business
Buying or selling a business can be a minefield. If you’re buying a business, there are many questions you need to answer The most basic of which might be “what am I buying”? Yes, something as simple as that can be very complicated. Are you buying the assets of the business of the equity in the business?
If you’re selling a business, what’s the best option. Not only are there property issues, there are taxation issues and practical issues. These all need to be addressed.
We aim to guide you through the maze of buying or selling a business. We’ll help you reach a successful conclusion of the deal.
Before you start
Be clear what it is you’re buying or selling. One of the key aspects of these types of transactions is clarity. What you’re buying or selling can have serious consequences. If, for instance, you’re buying the equity in a company that owns the business, you not only gain all of the assets but also become responsible for all the liabilities. On the other hand, if you’re only buying the assets you don’t inherit the liabilities. If property is involved, it is owned or leased – and what about the assets – are they owned or leased? Make sure all and any licenses and permissions are available if you’re selling so we can show these to the buyer’s solicitors.
Negotiating the sale and purchase contract
This tends to be a process between solicitors with the documentation going backwards and forwards building up to a final agreed document. Reference will be made to all aspects of the sale or purchase and will set out when certain things should happen. This may also include the documentation that transfers ownership of any land and buildings or of any lease of property. We will work with your accountants and financial advisers on the financial and taxation aspects of your sale or purchase. Finally, we will reach the point where we can recommend the agreement for signature. It’s important to realise that if you’re selling the equity in your business, you will be asked for warranties and to provide indemnities in the event of the warranties being proved false. You must be careful when granting these as they can have serious ramifications.
Settlement
Once the sale and purchase documentation has been completed and both sides are happy with it, arrangements are made for settlement. On settlement the price is paid and the documentation exchanged resulting in a change of ownership of the business and assets.
It’s very important to fully understand all aspects of your sale or purchase of a business and the structure of the deal. We’ll help you through the entire process.
Buying or selling a business? We can help
Buying or selling a business can be a minefield. Let our experienced solicitors guide you through the process