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Due Diligence

Selling a business: Due Diligence

Any buyer will want to carry out a due diligence check. This means they will want to consider every aspect of the business including legal and tax implications, any existing employees, any existing debts and the future of the industry your business is in.

Due Diligence – not just the buyer’s problem

If you are not a company then your buyer will be purchasing the assets but if your business is owned by a company then you will choose to sell either shares or the assets of the company. If you sell shares you are effectively ending the relationship between you and the company.

An asset purchase will have to clearly identify what is and what is not part of the purchase. An asset purchase agreement will tend to include matters relating to employees, stock and equipment. Again warranties will be expected of the seller.

If you are able to provide comprehensive replies to the enquiries raised by your buyer then this will give your buyer confidence in you, in the business and in their purchase - thereby leading to a smoother sale.

Good due diligence replies can also be used as a reason to reduce the number of warranties you are asked to give. At this point we would then look to add a letter of disclosure to accompany the warranties to ’iron out’ and clarify any specific matters affecting the given warranties raised in your replies to enquiries.

 Download our Guide to Selling your Business here. 

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Coronavirus:  We are pleased to announce we are Open for Business

Even during Leicester’s most recent, extended lockdown, you can be assured that it is ‘Business as Usual’ at Lawson-West and we're here to help you with your legal needs. 

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At this time, please contact us by telephone, website enquiry or email.
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Leicester:
4 Dominus Way, Meridian Business Park, LE19 1RP           Tel: 0116 2121000

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44 Long Street, Wigston, LE18 2AH                                              Tel: 0116 2121080

Market Harborough
Millers House, Roman Way,
Market Harborough, LE16 7PQ                                                        Tel: 01858 445480

Website:     www.lawson-west.co.uk

Email:           mail@lawson-west.co.uk

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