Jul 19, 2023
In ABCast Episode 20 - Preparing a Company for Sale our founder, Janathan Allen, discusses all of the steps required to get ready to sell your business and the concepts and goals you should evaluate before you begin the process. What do you, the seller, want out of the transaction? What are your cash needs going forward? Are you willing to remain in place to help with the transition or do you need to move on? What are the tax ramifications of the transaction? What are the specific steps and how long will this process take?
It may surprise most business owners to learn it can take more than a year to prepare their company for sale. In Episode 20 - Preparing a Company for Sale Jan begins with the question of "why do you want to sell?" and moves through each step of the process. Usually this begins with organizing the corporate entity, the books and other aspects of the business which will maximize the value of the entity and ease the process of selling it. The decision of an asset sale or a stock purchase transaction is crucial. The buyer and the seller have opposing interests in each of these types of transactions and the structure of the transaction itself will have a substantial yet differing tax impact on the buyer and seller.
Episode 20 - Preparing a Company for Sale discusses the process to update and/or audit the financials and the books. How will key employees and key customers be managed? Are there any contingent liabilities or crucial creditors which must be addressed? Once the organization is prepared for sale and a Letter of Intent is in place, the extensive process of due diligence will begin. This can also take several months and helps the buyer to validate the information provided by the seller.
The first step is to find a partner who can help with all of the legal, tax, accounting, estate planning and business issues associated with the transaction and provide sound insight, advice and counsel based upon decades of experience