ACQUISITIONS MERGERS & DISPOSALS
The most common way to buy or sell a company is by way of a share purchase arrangement. Fixed fee quotations on: 02477 981545
Reasons for making an acquisition or disposal
The parties’ motivation will be essential when structuring and negotiating such a transaction. The party’s legal advisors need to understand the main commercial drivers for the deal. Each party will have their own objectives.
The purchaser may want to develop the business. Sometimes, the target business will be of particular value due to synergies that it brings. For example:
• The target company’s business may complement the buyer’s business because it manufactures and supplies a critical part of the buyer’s product.
• The buyer may be able to benefit from economies of scale and other efficiencies where it acquires a competitor business.
• The target company might have available tax losses that would benefit the buyer’s overall group tax position.
Whatever the reason there should be a clear strategy from the outset. The purchaser should also have a very good idea of:
• How much they are willing to pay.
• The time-table for the purchase.
The seller will also have certain financial drivers that will be key in any sale. A seller will be looking to sell for a number of reasons, such as:
• Cashing in on the capital growth of the company.
• Moving into a different sector.
• Selling off part or whole of the business which is failing to make much profit or even a loss.
What is the process to Sell a Business?
Whilst not being specific, the following will generally happen:
• Pre-contract documents, such as confidentiality agreements, heads of terms and exclusivity agreements will be prepared.
• The parties will carry out due diligence. In doing so, relevant data will be made available.
• Documentation will be prepared ready to carry out the transaction
• Any necessary third-party consents and approvals will be obtained.
• Transaction documents will be signed and shares transferred to the purchaser.
• Post transaction formalities.
How can we help you?
If you are looking to buy or sell a business, please get in touch for chat so that we can what you want to achieve.
All initial enquiries are completely free of charge, so please do not hesitate to call us on: 02477 981545
We can provide a number of funding solutions including a fixed fee quotation and payment by instalments.