Mergers & Acquisitions, Compraventa de empresas

How to sell a company?

Étiquettes : , , , , ,

The sale of a company is a complex process that lasts a minimum of six months and can be extended to twenty-four if negotiations with potential candidates fall through.

Experience has shown us that the average time of a professional sales transaction maximizing the interests of the seller takes around nine months.

To explain the process, we will use the case of a price maximizing broad search.

The first thing to do is decide our ideal type of operation. This means that all the documentation will be focused on this aspect. Throughout the process it is normal that new, previously unconsidered opportunities arise during the exchange of ideas with potential buyers that will help us achieve our goals.

Once the perimeter of the sale is defined, a blind teaser should be drawn up. This document will be the one that the advisors will circulate between potential buyers and investors. This document has enough information to show the basic aspects of the company and create interest in it, but not enough information to be able to identify it. An information memorandum and a valuation report are also drawn up.

Once these documents are prepared, a mapping  of counterparties is made. This mapping is a document outlining potential buyers and includes a short list of the candidates who will be contacted first.

Contact is made by sending out the blind teaser and, if there is interest, a confidentiality agreement is signed. Once it is signed, the candidates receive the information memorandum.

After analyzing the information memorandum, the candidates decide whether or not to continue with the process. If they want to continue, they will have greater contact with the company and they will be given additional information.

Nevertheless, in order to move the process along, a point is reached where the candidate will need to present some non-binding offers in order to receive more information, i.e. he will need to define what price range he would be willing to pay and under what circumstances. These offers let us discard those candidates who don’t fit our client’s needs and it means we will only give more information to those potential buyers with which there is a greater understanding in terms of a potential transaction.

From there on, the candidates are provided with more information via a data room (a closed room with access to information, but from where it is impossible to take out or photocopy information) so that they can prepare a binding offer. Once the binding offer has been negotiated by both parties, it will result in a letter of intent. This agreement outlines the conditions of the transaction and its validity is subject to the results of due diligence.

Due diligence is the term given to the checks that a buyer should make before buying a company. These checks consist of verifying that everything that has been said is true and that there are no hidden liabilities. To do that, the buyer hires advisors to thoroughly analyze the company: auditors to verify the accounts, lawyers to validate the contracts, tax experts to check that taxes are paid and other advisors or experts are needed depending on the company’s activity.

If the candidate verifies that everything is true and that there are no surprises, the next step in the process is the contract of sale. If there are aspects that don’t correspond, the conditions of the agreement will be renegotiated.

Are you prepared to sell your company?

If you have any doubt, contac us.

Artículos relacionados


Best retirement options for business owners: selling the company To retire off the back of selling one's company remains one of the quintessential dreams of any entrepreneur, but such an outcome does not simply arise from having a successful business. Some owners delay the process of succession until it’s too late...
The process of buying a business: due diligence The indicative offer has been placed and the letter of intent has been signed. The next steps are to confirm that, in fact, the business that we want to buy has all the characteristics that we believe it has. Everyone likes surprises, but not in the ...
(Español) La Due diligence: análisis a realizar Désolé, cet article est seulement disponible en Espagnol Européen et Espagnol Mexicain.

Il n'y a pas encore de commentaires

Écrire un commentaire

Partager cet:

Les plus populaires

Where is your buyer? ONEtoONE

Abonnez-vous à notre Newsletter:

Les plus populaires:

Now is the Time to Sell Your Business

It may have taken you a lifetime or even generations to create substantial value in your business, but with the right planning and advice it may take only a year or two to double that value. Succession issues, retirement, technology, globalism, scale, etc. are all viable reasons to be thinking about selling your business. But […]