How to Prepare Your Business for Sale

Category: M&A · Exit Reading time: 2 min

Selling a business isn't something you improvise. Founders who exit on the best terms share one thing in common: they started preparing well before the opportunity came knocking. Here's why — and how.

Preparation is 80% of success

When a serious buyer enters a sale process, they mandate their lawyers and auditors to scrutinise your business from top to bottom. That's the due diligence. Every irregularity, every poorly drafted contract, every missing board resolution becomes an argument to lower the price — or walk away from the deal entirely.

The good news: all of this can be addressed in advance. Ideally 12 to 24 months before.

The legal clean-up: a practical guide

Preparing a sale, concretely, means:

• Regularising what isn't in order: missing board resolutions, unsigned contracts, leases that need updating.

• Simplifying the structure if it's too complex: unnecessary holding companies, inactive subsidiaries.

• Documenting what's underdocumented: intellectual property, internal procedures, verbal agreements that need formalising.

• Securing key contracts: major clients on long-term agreements, strategic suppliers, distribution agreements.

The objective is straightforward: the buyer's audit should reveal nothing unexpected. Every potential issue identified in advance is a valuation point preserved.

Financial and tax preparation

Selling your business is also a major tax event. Depending on the deal structure — share sale or asset sale, with or without a holding company — the tax bill can vary dramatically.

Anticipating this with an accountant and a tax lawyer from the outset can represent a significant difference in net proceeds. Also think about pre-sale dividend distributions, clearing shareholder current accounts, and managing excess cash intelligently.

💡 My advice: Start thinking about it 18 months ahead. Not because it's complicated — but because every additional month of preparation can be worth several valuation points.