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Selling a Business in Northern Ireland

Like anywhere else, selling a business in Northern Ireland can be straightforward. But it can also be a considerable challenge. Many of these challenges are out of your control, but others can be mitigated with consideration towards preparing your business for sale. None of this is easy, but there is a process that can be followed that will make it “easier-ish”.

Preparing your business for sale is not the same as maximising value

In this article, we’ll look at the steps to selling a business and actions you can take to ensure it follows a standard process and is as straightforward as possible. This list isn’t exhaustive and each step has many moving parts, but it will begin to prepare you for the biggest sale of your life.

Please note that in this article we’re not talking about maximising the value of your business, but feel free to set up a Discovery Call with our team if this interests you, as this is exactly what we offer here at Move at Pace.

What are the steps to selling your business?

1. Why do you want to sell the business?

Deciding to sell your business is not to be taken lightly. You only get one chance to sell your business and your reason why is the most important factor. It’ll be the first question any buyer asks.

Some of the most common reasons to sell a business are:

  • Realise value from your hard work
  • Retirement
  • Falling out of love with the business
  • Being unable to run the business at its current level
  • The business isn’t trading profitably
  • Partnership disputes

Some of these reasons are incredibly positive opportunities, but others are not so much. Understand how your response to this question will affect the buyers’ attitude toward the deal. Selling from a position of strength, where profits are healthy and the business is in a strong position can help you command a higher price, than selling when issues are present.

2. Timing your sale

We speak to many entrepreneurs who had no intention of selling their business until one day through no choice of their own, situations change. 

Running a good business means your business is “sale ready” when you want it to be. But for some businesses, it may take time to get your house in order and get in the optimum position for sale. Certainly, keeping accurate records, developing systems and processes, creating value in the business and retaining clients over the long term are activities we should all be focused on, especially if there is a consideration for a potential exit.

Running your business effectively supports growth, but is also a huge benefit when it comes time to present it for sale.

3. Valuing your business

Valuing a business for sale correctly will ensure you get comfortable with the potential value you will be able to extract from the process. Your accountant, a business appraiser or your chosen Transaction (Mergers & Acquisitions) broker will help you determine what this value could be.

Remember your business is only worth what someone will pay for it and to extract maximum value from it, you need to work on a value creation process in advance of selling.

4. Hiring a transaction team (aka a broker to manage the sale)

In Northern Ireland, we have a small number of boutique and corporate M&A teams helping business owners navigate the process of selling their company. We work hand in hand with these teams and all related parties collaborate across each of the following steps, to ensure your sale moves smoothly through from pre-sale preparation to completion.

  • Pre-sale preparation 
  • Marketing the sale to prospective buyers 
  • Receiving and assessing initial offers
  • Negotiating best offer
  • Handling the agreement in principle (heads of terms)
  • Managing Due diligence 
  • Completing
  • Statutory requirements

5. Due Diligence

Once your M&A team in place, you need to prepare all of the documentation required as part of the due diligence process. Depending on the nature of your business, this can be quite an extensive and laborious task. But with any missing items, your sales won’t be complete. The buyer needs to be confident in the business and the more “sale-ready” you are, the better.

During the due diligence process, you are required to collate information from every business function.

  • Finance
  • Human Resources
  • Production
  • Contracts
  • Environmental
  • Health and Safety
  • Tenders
  • Insurance docs
  • Information Technology

Each of these may have dozens of sub-requests and so preparing for these in advance is prudent. Spreading the time taken to collate this information, ensures that you can continue to concentrate on running the business during an arduous process.

6. Finding a Buyer

Your chosen M&A team are primarily tasked with finding prospective buyers. We want multiple interested parties to create competitive tension and maintain or drive the price of purchase higher. 

The process of presenting your business to potential buyers is often referred to as the “beauty parade”, but it is a necessary task to achieve maximum value. Working collectively with the M&A sell-side team, we focus on presenting the business to interested parties in the best light.

The M&A team liaise with bidders and helps to determine the best offer you should proceed to final negotiations with. Ultimately they handle the sale of the business.

Final thoughts

Remember a sale isn’t a sale until the money is in the bank. Many deals don’t complete and these often fail for factors outside of your control. The time it takes for a business sale to complete often comes down to your readiness with the above steps. The more prepared or “sale-ready” your business is, the quicker it can complete.

If you are considering selling your business and want to maximise value, minimise risk and give yourself the best opportunity to close the deal, then get in touch with our team for a free discovery call. We’ll work to advise you on how best we might be able to help.

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