Do I need a solicitor when selling a business?
The sale of your business will be directed by a team of professionals with a breadth of expertise, including business transfer, business valuations, accounting, and legal, to help push the sale through to completion. Each party will claim their fair share of responsibilities to achieve the shared goal - to maximise sale value and mitigate risk.
To champion the sale of your business, you will need to appoint an expert team which comprises a business transfer agent or a business broker to advertise your business for sale and source a suitable buyer. A valuation expert will value your business to calculate its worth. An accountant will oversee the financial management of the sale to ensure that the deal is structured cost-efficiently and that your financial affairs are polished and up to date for the attention of prospective buyers.
A solicitor’s role in a business sale is to ensure that every aspect of the deal is legally sound.
What are the duties of a solicitor in a business sale?
When selling a business, appoint a solicitor to provide legal advice throughout the transaction to ensure that the deal is compliant and that every risk factor is assessed before an agreement is signed with the buyer. The duties of a solicitor in a business sale include to:
- Legal advice – Advise on any legal issues, such as transfer of undertakings (protection of employment), non-disclosure agreements and buyer enquiries that may require legal expertise
- Due diligence – Comb through the buyers’ background and previous business dealings to identify any legal risks as part of legal due diligence checks
- Contract review and preparation – Review sales contracts to ensure a fair deal and devise watertight terms to govern future claims
A solicitor is essential to the business sale process and a small investment that can help avoid costly future claims.
- Previous sales and acquisitions experience
- Sector specialisms and average success rate
- Sales value expectations and growth potential
How to appoint a solicitor when selling a business
The search for a solicitor can feel daunting due to the number of options available, services on offer and costs. Here’s a checklist of what to look for when appointing a solicitor.
Qualifications – Check credentials to confirm that the solicitor is a credible legal professional
Experience – Are they experienced in business sales as this often requires specialist knowledge of legislative measures
Feedback – Is client feedback on the services on offer and customer experience positive? Are they reputable and trustworthy?
Value for money – Is it an all-inclusive service or are additional costs likely to incur if the sale is complex? What is the industry benchmark and how does the fee structure compare?
If you sell your business through a business transfer agent, they may be able to recommend a trusted solicitor as part of their network of suppliers.
The Selling My Business team are on hand to support you throughout the business sale process. Our business brokers have experience across a range of sectors, including retail, hospitality, and leisure, to healthcare, construction, and distribution. For expert support, arrange a free consultation with Selling My Business.
