How to Sell Your Business
In the coming decade, over $2 Trillion in small business assets in Canada are expected to change hands as 76% of owners look to bow out. For many of these owners, the sale of their business will be their first and only experience with an M&A transaction. There is a tremendous amount at stake for owners looking to fund their retirement or next project.
In this guide to selling your business, we set out the steps, processes, and options when selling a business that can help business owners maximize the return from their years of hard work.
Chapters in this guide
How and when to provide detailed information on your business to a potential buyer while protecting your confidential and proprietary information.
You want to receive a fair price in exchange for the business you worked so hard to build. Obtaining a valuation from a Chartered Business Valuator (CBV) is a great starting point.
Projections demonstrate the future cash flow a prospective buyer can expect from the company if they purchase it, and are critical to determining the sale price.
Restructuring your business prior to a sale can maximize value and minimize taxes through the sale structure, capital gains planning and family trusts.
The value of your business and ultimate sale price can differ for private equity buyers, strategic buyers and sales within a family.
A review of the benefits, risks, process and financing of the sale when a management buyout occurs.
A review of the payment options available when negotiating the sale of a business, including cash, shares, assumption of debt, earn-outs, holdbacks, and promissory notes.
Post-sale tax considerations sellers should consider include estate planning intentions, planned distribution of assets upon death, philanthropy, and personal needs.
Working capital disagreements can derail a deal and can become an unwelcome contentious issue even subsequent to a deal closing. But problems can be prevented.