Buying a Business
Whether you are buying a limited company, or an unincorporated business from a sole trader or a partnership, you want to make it a success. While you do not have to use solicitors to purchase any business, commercial legal advice will help you to give your business a solid foundation and avoid wasting your money.
In deciding to buy a business you will have taken a view on what income this will generate for you in the future. How have you made your assessment? You will probably have looked at various accounts and figures that the seller has generated for you, but how do you know you can trust these figures? The answer is that, as well as checking the figures thoroughly in what’s known as a due diligence exercise, you ask for various contractual assurances from the seller that the figures are accurate. We can help you put in place a mechanism by which if the figures are not accurate then
- you can recover some of the money you paid for the business, or
- you are not obliged to make further payments.
How do you know what you are getting when you buy a business? You need to be sure that you
- get the benefit of various outstanding contracts and debts owed to the business
- protect the goodwill
- gain assurances from the seller that they will not set up in competition.
We can help you get your business off to a secure and successful start. It is astonishing how many people buy businesses and then are disappointed to find that the seller goes off on an extended holiday before returning to set up in the same town. We can help protect your goodwill against such risks.
What about the employees? When buying a business you take a lot on trust. If employees have grievances and claims outstanding against the business, then when you acquire the business the responsibility for settling those claims rests with you. We can help you investigate and then minimise the risk of such claims.
Buying a business is one of the most exciting things you can possibly do. You will need to be enthusiastic and hardworking to make that business succeed. We can help you to make the most of your investment and avoid wasting your money.
For further advice on buying or starting a business, call Patrick Farrington in Stafford on 01785 211411.
Published on web site – April 2007
The contents of this article are for the purposes of general awareness only. They do not purport to constitute legal or professional advice. The law may have changed since this article was published. Readers should not act on the basis of the information included and should take appropriate professional advice upon their own particular circumstances. (50587)