Buying a business – things to consider...

At Lawson West, we specialise in business acquisitions, advising companies across various different industries in Leicestershire and beyond.

If you are contemplating or negotiating a business purchase you should consider involving a legal expert at an early stage. The legal process can take around 3 months to complete and identifying key concerns at the outset should help you work towards your target completion date.

Purchasing a business involves important decisions that require careful consideration. We have outlined some of these below.

Should I purchase the Shares or Assets?

You should decide this at the outset, as it will determine the structure of the deal. Each option has advantages and disadvantages, but asset purchases are generally seen as more “buyer-friendly”. We discuss this at greater length here.

What Due Diligence should I undertake?

Investigating the business you are buying is a key part of any purchase. Effective due diligence will identify liabilities, pinpoint risks and ultimately help you decide whether to proceed on current deal terms or re-negotiate.

For more detailed guidance see here.

What warranties and indemnities do I need?

These are contractual protection for buyers in the main purchase agreement. Warranties are statements of truth given about the business and indemnities are strong buyer protection for specific risks you require the sellers to be responsible for.

For a more detailed explanation please see here.

What restrictions can I put on the Seller?

Purchase agreements often include clauses restricting the seller’s actions post-completion; typically to prevent competition post-completion. Such restrictions need to be reasonable and protect legitimate business interests to be enforceable.

How Lawson West Can Help

Buying a business can be a complex process, but with an experienced team by your side, it is far easier. We look to ensure that every deal is as fair, pragmatic and commercial as possible and aligned with your best interests. We look to work closely with your accountant and other professional advisers in achieving a successful outcome.

If you’re considering buying a business and want to discuss your options, then please contact Rob Flannagan on 0116 212 1033 or email rflannagan@lawson-west.co.uk

 

View all