Key consideration when passing on your business to your family or selling it to a third party.
When planning to sell your business to a third party or passing it on to a family member the following factors need to be addressed:
Selling to a third party – Key Considerations
1. Value of the business – obtain an independent valuation. An expert's valuation figure provides a fair and unbiased view of the worth of the business.
2. Surplus Assets – are there any surplus assets in the business that you wish to extract before sale. Surplus assets are those assets that are not essential for the operation of the business by a company. These may include property, investments in public companies, excess cash and loans to other private companies.
3. Finding a buyer – there are many factors to consider when looking at a potential buyer including the following:
4. Timing issues
5. Future of family members employed in the business – will they remain on during the transfer period or will they continue as employees after the sale has gone through
6. Ensure all family members are fully committed – before staring the process all family members must consider what they want from the business
Passing the business to a family member – Key Considerations
Planning for wealth transition or third party sale can be a complex process with numerous aspects involved from financial, legal, commercial, tax, business and emotional issues so planning is crucial.
Contact Deirdre McDermott Director OSK for further advice on selling the family business or in relation to OSK’s tax and accounting services.
A video message from Tadgh O'Sullivan, Director.
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