Acquisitions: How to Prepare Your Company for Sale

Are you in the early stages of considering putting your company up for sale and letting another entity acquire your business? Whether you’re looking to retire, diversify your investment portfolio or simply focus your efforts elsewhere, corporate acquisitions are a fantastic way to close one chapter and open yourself up to what happens next. With careful preparation and a clear focus on your end goal in mind, selling your company can be a relatively hassle-free process that allows you to celebrate your accomplishments and move on to the next phase in your life.

As a trusted corporate legal team servicing BC’s Lower Mainland, Paperclip Law is pleased to partner with businesses of all sizes for acquisitions and mergers, as well as a wide assortment of other business matters. If you’ve been contemplating selling your business and aren’t sure how to proceed, below are six aspects you’ll want to have in mind to get ready.

1. Prepare Well in Advance

You didn’t build your company in a day, so it makes sense that selling everything you’ve worked hard to create will take some time. Ideally, you’ll want to start laying the groundwork for the sale of the company years in advance. Doing so will give you plenty of time to get ready, and generally leads to better sales prices, smoother negotiations, and fewer headaches down the line.

2. Get Your House in Order

Selling your company is a major step, and as we’ve indicated above, there are a few things you need to prepare before you dive into official proceedings. For the best results, take the time to work on your books, update any systems you use, overhaul any outdated practices and policies, and handle any glaring issues long before welcoming any outside prospectors into your world. Not only will give you plenty of benefits when it comes time to sell, but it will also pay dividends for everyone to enjoy today.

3. Look into Trends and Patterns

As you go about evaluating your systems and practices, take a closer look at the trends you’ve observed over the past 2-3 years. Are there noticeable patterns among customers or suppliers? Do you have predictable down seasons? Have your staff been with you for a long period of time?

Stability is one of the most attractive features a business can display to a potential buyer; use trends and data to your advantage and as an opportunity to come to an informed decision about the sale price as well as potential points of negotiation.

4. Know What You’re Selling

It may sound like common sense, but you’d be surprised how many business owners are looking to make a quick exit without paying much mind to what they’re actually selling and how they present it. Be prepared to put your game face on and your best foot forward by supplying investors and buyers with plenty of information and by having a well-honed sales pitch that makes your company stand out from the crowd.

5. Find the Right Buyer

We get it, sometimes you need to sell now. With that being said, rushing into a sale and partnering with an untrustworthy or poorly matched buyer can often be just as problematic (if not more so) as waiting for the right fit. Take the time to get to know your prospective buyers and see if they align with your company’s vision and the culture of your existing team. Doing so will make a long-term fit far more likely and reduce morale strain among employees who choose to stay on.

6. Do Your Due Diligence

Due diligence is an integral part of the acquisition process and should never be rushed by either party. Do your research on your buyers, and be prepared to air any dirty laundry with your chosen purchasers when the time comes. Remaining open, honest, and objective will keep everyone focused and reduce the chances of either party needing to back out at the eleventh hour.

Ready to Make Your Move?

If you need help handling corporate acquisitions and mergers, Paperclip Law has you covered! Our team of experts is happy to partner closely with you to cover all the important details and make sure you’re set up for success today, tomorrow, and for the many years to come. Contact us today to learn more!