It is important to have a solicitor you can trust when buying a business. A good solicitor knows it can be worrying for clients when there are so many complicated legal matters flying around, particularly where large sums of money are concerned. With the right solicitor in your corner, you can be confident that the transaction will be handled professionally and with your interests as the focus point.
How can Scott Bailey LLP help you when buying a business?
Our team of experienced company and commercial solicitors have the skills to help you with every step of purchasing your new business. We regularly assist clients with:
- obtaining a valuation for the target business.
- negotiating heads of terms.
- carrying out appropriate due diligence on the target business. Where appropriate we use virtual “data rooms” and digital file sharing for ease of document management for all parties.
- considering existing commercial agreements and contracts.
- relevant employment issues such as TUPE and employment contracts.
- negotiating the terms of the business sale agreement.
- transferring funds.
- transferring the property interests and other contracts.
Share purchase or asset purchase
There are generally two types of business acquisition: share purchases and asset purchases. In a share purchase the buyer acquires the business “warts and all”. As such, the buyer takes the company with its rights, benefits and assets, but also the liabilities. This is why buyers must secure appropriate warranties from the sellers so as not to be exposed to undue risk post completion. Examples of common warranty provisions include finance and banking, accounts, IP and commercial contracts, employees, property and tax.
Asset purchases on the other hand, allow a buyer to take the desired assets whilst leaving behind negative elements which are not required. Warranties should still be secured on asset purchases in order to protect buyers from inheriting more than they bargained for, but they may not need to be quite as wide-ranging as for the equivalent share purchase.
The corporate solicitors at Scott Bailey LLP have considerable experience advising clients on appropriate levels of warranties for both share purchases and asset purchases, and appreciate there is no “one size fits all” approach.
Addressing problems when buying a business
When buying a business, there are numerous issues that can provide challenges for buyers to navigate. As expert business lawyers, our corporate solicitors guide clients over such hurdles so that their purchases can go through successfully.
The company and commercial solicitors at Scott Bailey LLP draw up appropriate purchase documentation for our clients so that if problems do arise post completion, our clients know they have the desired level of legal protection in place. Some of the tools and mechanisms we use to protect buyers when purchasing a business include:
- appropriate warranties confirming the business’s condition at the point of completion.
- indemnities relating to specific known business liabilities.
- retention of part of the purchase price for the length of the warranty period where there is a high risk of breach.
- restrictive covenants to prevent the sellers competing with the business post completion.
- price reduction.
Choose Scott Bailey LLP as your solicitors when purchasing a business
As a long established and experienced firm of solicitors in Hampshire, we have extensive expertise in company and commercial law, having handled countless business purchases of many shapes and sizes. Whilst we may not be the lowest price, our team are committed to offering clients the very best possible level of service.
As well as expert company and commercial solicitors, our property team handle every aspect of your commercial property purchase, whether freehold or leasehold, from authorised guarantees to registrations and bank funding, and we’re confident that the advice we give will provide you with what you need to make the important decisions.
If you are considering purchasing a business, please contact Ben Ironmonger.
Our company and commercial solicitors are based in Lymington, in the New Forest between Bournemouth and Southampton, and act for business clients across the South Coast region.