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Selling A Company: Keeping The Process On Track

By: Colm Manning | Posted on: 30 Sep 2019

Selling A Company: Keeping The Process On Track

Selling your business is often the peak of years of hard work and persistence.  There is no greater validation that you have created something of value. 

That said, it can also be a demanding process in which a seller becomes highly invested to the point of it taking over all else, both professional and personal.

I have set out below some of my perspectives on the company sale process and some tips that can help prevent a deal from stalling or becoming more difficult than it has to be.

That was never part of the deal!

While the temptation is always there to accelerate the deal and jump straight into documenting the terms of the purchase documents, always take the time to agree a heads of terms. 

While it does not have to be an exhaustive document, a heads of terms often flushes out issues on which the seller and the buyer are not aligned.  Those misalignments usually surface later in the transaction.

If there are hard issues to be discussed and hard decisions to be made, deal with them up front.  The difficulties arising from putting issues off to a later time can be accentuated by other factors.

One and only

Give careful thought to whether or not you are willing to deal with your potential buyer to the exclusion of all others.  While being selective about your potential suitor is a good thing, you don’t want to unduly limit your options by granting exclusivity to one buyer. 

A seemingly perfect buyer can get cold feet or otherwise fall victim to external influences which render the deal no longer attractive.  In those circumstances you may lose valuable time and momentum.

If your buyer insists on exclusivity, put a time limit on the exclusivity period (perhaps to coincide with significant progress having been made in due diligence).  That way the buyer is given enough time to decide if the target remains attractive and you can move on if the buyer is not progressing rapidly enough.

Trusted lieutenant

Deal terms are highly sensitive and there is often an unwillingness on a seller’s part to disclose them to those working within the business.  For obvious reasons, a potential sale should not be the talk of the office. 

However, it is helpful to bring a trusted lieutenant or two from within the business into the transaction.  For example, they can perform a supporting role on what can be extensive financial and legal due diligence. 

A buyer will want to know every inch of the business.  Sharing the information that a buyer needs is a time-consuming task, the burden of which can be shared.

Diligent on diligence

Nobody likes responding to a 50 page financial and legal due diligence queries list.  However, give it the attention it deserves.  Being organised and prompt in responding to the buyer’s diligence exercise will demonstrate that: (1) you are serious about the transaction; (2) you understand that the buyer is simply familiarising itself with the business; and (3) you’re doing what you need to do to make an important buyer process run smoothly.

Dealing with outsiders

Figure out very early on whether or not the sale needs regulatory or other third-party consent in order to complete.  Be that pursuant to a licence condition under which the business trades or any other third-party consent right (a lender, for example). 

Be mindful that a regulatory body or another third party may not have the same desire as you to get things done quickly.  Bring them into the conversation as soon as it is appropriate and in a manner that satisfies the buyer. 

You promised to keep a secret!

Choose your potential buyer wisely and recognise the limitations of a non-disclosure agreement.  While a buyer might be prevented from disclosing your trade secrets to a third party, they may be keen on using it for their own purposes and not the transaction.  Careful drafting of the non-disclosure agreement will help, but exercise a healthy degree of caution with what you disclose, especially to a competitor or trade buyer.

Trust your gut

Don’t let lawyers, accountants, tax advisors, corporate finance or other advisors make the important decisions for you.  They are only there to offer advice.  As a seller you need to fully understand the deal and agree its terms based on what you’re comfortable with.  Don’t accept a deal term that does not sit easy with you just because it is identified to you as “market” or “typical”.  Remember, you are the one signing the agreement and assuming the consequent risks in doing so.

The long road

The process of selling a company is not a sprint, it is often a marathon.  Months can pass between the time that a buyer is identified and the time documents are signed.  Indeed, from the date that you decide to sell your business, a number of iterations of the deal may founder.  Buyers come and go, even after they have indicated a strong interest. 

In the meantime, keep growing and focussing on the “day job”.  A better set of results or growth within the business may draw the attention of other interested parties or improve the terms on which you sell.  It may also inform whether or not a sale at that time is the right option for you.


Colm Manning


BDM Boylan Solicitors 

Clarkes Bridge House,

Hanover Street,


021 431 3333