Exiting your business: Deciding what you should sell
If you are a sole trader or partnership, then any sale of the business is a sale of the assets of the business. If the business has built up any goodwill, then that goodwill is classed as an 'intangible' asset and may also have a value. If the business is held in a company then a potential purchaser might want to buy either the assets of the business or the shares of the company, and there are significant tax and commercial differences between these two options. In broad terms, a vendor is likely to want to sell the company and the purchaser is likely to want to buy the trade and assets.
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- To extract surplus cash or any other assets that the purchaser does not want to buy, such as investment or other assets unrelated to the trade. This might increase the value of the deal to the vendor with no loss of value to the purchaser.
- To take out any assets that the vendors do not want to sell. The company premises often fall into this category, with the purchaser entering into a lease arrangement on the premises as part of the deal.
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Where next?
Within Selling your business…- The value of your business
- Finding and approaching prospective buyers
- The information memorandum
- Form of consideration
- Heads of Terms
- Due diligence and contract negotiations
- Completion and beyond
- Planning your exit
- Floating your company
- Exiting a partnership or minority shareholding
- Family succession
- Closing down
- Tax issues
- Contact us about this issue
- Read about how we can help you & your family
- Request a meeting with us
