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How do I maximise the value of my business on exit?

Preparation 

This starts well before the sales process begins, it’s likely to include each of the points below, the first step often is simply committing to the decision to put timelines on your exit plan. 

Finding the right buyer 

Sometimes the buyer will approach you as they’ve identified your business as a good fit for their particular criteria, more often, time and research are needed to identity the right buyer for your business, this may be a competitor or a supplier or simply an investor looking for opportunities to deploy capital. 

Information 

High quality, timely and accurate Information is critical to maximising value and ensuring the transaction completes. If the buyer cannot get comfortable with the details and supporting documents underlying the reasons why the business is attractive to them, many will seek a price reduction or reconsider the transaction. 

Timing 

Business valuations are subjective and can be volatile, wider macro conditions such as general economic sentiment and interest rates can impact business valuations significantly. Economic cycles are beyond your control, but being aware of them will help you plan the timing of your exit.  

Shareholder alignment 

Where a business is owned by multiple shareholders, some of whom may be less involved in the day to running of the business, it’s a good idea to make shareholders aware of the potential for sale early on to ensure that there are no objections and to manage expectations in terms of value. 

Where circumstances arise that shareholders do not agree on the key points of a proposed transaction, this can make completion very difficult or impossible.  

The next step

If you have any further questions regarding this insight, please contact Robert Magee, or your usual UHY adviser. 
 

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