Exit strategies and buyer routes

Peter Hogan Commercial Road

While running your business day-to-day, your exit strategy might not be at the forefront of your mind.

But planning in advance allows you to choose how you want to leave and to prepare the business accordingly.

If your main motivation is making a profit, retiring or investing in a new venture, selling your business is the best route. Then you need to find the right buyer. The more interest that is generated the better the sale price.

Typical buyer routes as follows:

Trade Buyers

A trade buyer already has a business, however the idea of combining two businesses is popular and these types of buyers are the most common bidders.

A trade buyer will look at the worth of the company, and is therefore likely to pay a premium price.

Acquisition companies

An acquisition company can be an individual or a company of around five or more individuals at director level. They want to purchase an asset, so a self-sufficient business can be more attractive.

Private Equity

These are high net worth individuals or companies that excel at putting strong, highly motivated executive teams together to maximise everything they can using the company assets. They can outbid trade buyers and give sellers more options to choose from particularly when it comes to deal structures.

EOT

An EOT is a trust which enables a company to become owned by its employees. It is tax free to a seller, with no capital gains tax and guaranteed full market value for your shares.

The market value is based on independent assessment.

Contact us at Commercial Road for a no fee, no obligation initial consultation.

Enjoyed this? Read more from Peter Hogan, Commercial Road

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