Buying/Selling Business

Selling or buying a business

If key contracts with customers are an important part of buying a business then each contract must be checked to see what its terms are, how long it runs for and that the customer can’t terminate for no reason.

If you are selling a business then it’s important to get paid the price you’ve agreed on. Often this will be dependent on the purchaser working in the business for a while to check the turnover but you need to make sure the purchaser operates the business correctly. Otherwise, the figures could be false.

If you are taking over a lease of premises, then you need to check the terms of the lease, make sure you will actually get the period you’ve been promised, obtain the Landlord’s consent, make sure there are no current defaults and, if it’s a retail premises, get a disclosure statement from the seller.

If you’re purchasing plant and equipment you need see the depreciation schedule. If the business has any customer orders that are unfulfilled check if you’re taking on the responsibility of fulfilling those orders. If so on what terms? If you’re purchasing software or other intellectual property you need to know if it has been protected by copyright. You may want to purchase the trade marks of the business in which case the Seller must relinquish all rights in the trade marks to you.

These are just a few of the issues that arise when buying or selling a business. And there will likely be many more issues, depending on the particular business. All must be checked thoroughly. If you are looking to buy or sell a business we would love to help you, so just give us a call and we’ll be happy to set you on the right path.

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