Thinking of Selling your business? Read this firstJanuary 19, 2018
If you have made the decision to sell your business, early preparation is recommended. This should give you a clear picture of exactly where you are and provide the opportunity to get your records in good order. The more prepared you are, the easier the process will be. You will also want to take advice from business sales tax specialist. This may be your accountant.
It is helpful to prepare an information pack. To do this you will need to gather all your financial statements and tax documents together, going back 3 years minimum and review them with your accountant. Make sure your finances are all up to date. List your suppliers and everyone you do business with and have a copy of your current lease available. If equipment will be included in the sale, list this as well. A buyer will carry out due diligence and you will be ready with the information. Your solicitor will also need this information to deal with any enquiries and advise on warranties and disclosure.
Here are some points to consider (these vary with the type of sale): –
Do you have sole authority to sell?
- Do all the owners agree to the sale?
- Do you require any consent, for example shareholders or bank?
What are the assets of the company?
- Can you provide a schedule of all the company assets?
- Does the company own all its assets?
- Are there licences in place for any assets, and are these licences current/valid?
- Do you need any confidentiality agreements in place to protect key contracts that may or to protect trade secrets?
What contracts is your company currently a party to?
- Will any of these contracts continue following the sale?
- Do you have copies of any maintenance, hire purchase, lease or commercial agreements?
- Are these contracts in writing and can you produce copies?
What are your company property arrangements?
- Do you have a lease in place for the company premises?
- Can you provide details of the company business rates?
- Can you provide the details of any insurance policies relating to the business or its premises?
Have you considered Intellectual property rights? (patents, trademarks, copyrights, designs)
- Does your company own all of the intellectual property it uses/needs?
- Are the rights in intellectual property registered?
- Do any contracts with the company employees refer to intellectual property?
What about employees?
- Will the employees be kept on after the sale (consider TUPE)?
- Who are the key employees who any buyer would expect to see retained?
- Do all the company employees have employment contracts?
- Do you have details of the company pensions schemes / policies? Are there any deficits in the pensions schemes?
- Can you produce a list of employee salaries?
If you would like to talk to Keith about business sales and purchases, you can contact him at:
T: 01756 700200