How To Sell A Business - A Guide

Choosing the right solicitors to help sell a business is crucial for a smooth and successful transaction. Selling a business involves careful planning, preparation, and execution, so taking time to understand how a sale works can be valuable.

Here are some steps to guide you in how to sell a business.

1. If you are looking to sell your business, you should instruct the services of a specialist business sales agent in your sector. They will market your business and attempt to find and agree a deal with a suitable buyer. Alternatively, if you know of any interested parties direct, you could contact them and if they are interested, a confidentiality agreement should be entered into which can be drawn up by your commercial legal team to ensure that all matters discussed are kept confidential.

2. You should speak to your accountant to ensure that everything is for when a buyer is found for your business. They will then be able to assist with any financial due diligence that an interested party would request.

3. Once a buyer has been found and a deal has been agreed, the detail of such a deal will need to be sent out in a document known as “Heads of Terms.”

4. Your legal team would then deal with the drafting of the suitable contact for sale to put into place the terms that have been agreed including any matters relating to the transfer of any properties or leases that are part of the deal.

5. A prudent buyer’s legal team will also insist upon certain contractual terms known as “Warranties” being included in the Contract for Sale. Your legal team would run through each of these warranties to ensure that you can either comply with them or whether they need to be struck out or limited by reference to disclosures which would need to be included in a Disclosure Letter.

6. Your legal team would also deal with legal due diligence enquiries which are often raised by a buyer’s legal team.

7. Once all due diligence enquiries have been dealt with and the terms of the Contract for Sale are agreed, your legal team would then take matters forward to exchange of contracts and formal completion when the transfer of your business would take place.

8. Your legal team would deal with the payment of any agent’s fees and the repayment of any mortgages that would need to be repaid from the proceeds of sale.

If you would like any assistance regarding the sale of your business in any sector, please do not hesitate to contact Andy Foley-Jones, Sara Parry, or Holly Wilkes in our Commercial Team.

Email: afj@macjones.com; sara.parry@macjones.com or holly.wilkes@macjones.com