How to sell a business as a going concern - against the clock

At Heligan Partners, we often talk about exploring all the options available to our clients. We believe it’s our duty to look at your business from multiple angles – there is always a range of options available. We recently completed an accelerated sale, during lockdown, when the owner initially thought that their only option was to wind-up their business. Our approach delivered a dramatically different result for all concerned.

It’s always satisfying to complete a deal and deliver an excellent result for a client. If we’re able to sell a business as a going concern, it is usually the best outcome for all parties. One of our recent engagements was the sale of a company in the construction services sector that was notable for several reasons. It began as a ‘lockdown deal’ and was completed remotely using virtual platforms for face-to-face meetings – all the client meetings, all the pitches and the legal process. It was also conducted to an accelerated timeline, completed in less than 75 days. Most importantly, it represented an outcome that wasn’t initially thought possible by the company’s owner.

Exploring the options

More often than not, we aim to balance timing, demand and exit readiness to achieve the optimum value for the business we are selling. Whilst everyone wants to see a timely sale, experience tells us that time invested in exploring the situation, researching the market, and engaging with potential buyers increases the value realised. Quickly but thoroughly investigating the options open to our clients always makes sense before deciding on the right plan of action.

In this specific case, a lawyer introduced us to the client. They had been asked to execute the legal and redundancy requirements of closing the business. The owner had decided that they wished to exit their business as quickly as possible so they could retire.

Navigating the possibilities and finding potential buyers

The process of liquidating the business presented possible exposure for the directors and shareholders of the company. It wasn’t a zero-cost option and it would, of course, also lead to redundancy for the company’s staff. After some initial discussions, we were confident that we could find a buyer. Not only that, but that a transaction could be completed within 90 days, the timescale set by the owner.

The team set about understanding the business, its operations, assets and performance. Having established that the recent loss-making results weren’t indicative of fundamental problems, we determined that the company would make an attractive option for a trade or financial buyer and prepared an information pack for potential buyers.

Sell a business as a going concern – as quickly as possible

A list of 70 potential buyers for the business was drawn-up based on market sector, geography and size. Buyers likely to be in a position to make a cash purchase were prioritised as this would help to ensure completion of the deal in the owners’ original timescale.

The potential purchasers were invited to submit questions and requests before moving to indicative offers for the business. This led to a competitive bid process with multiple offers, followed by four weeks of due diligence and contract negotiation with the selected bidder.

An outcome that works for all concerned

The result was that the company was sold as a going concern, adding scale to the buyer’s business and saving the jobs of the employees. The previous owner was able to exit and retire as planned without facing closure costs and commitments. The process was all completed inside 75 days. The outcomes serve as a reminder that there are always other options available to business owners.

If you’d like to discuss your options, your potential exit strategies or how to sell a business as a going concern, contact Heligan Partners today.
Brian Blakemore

Brian Blakemore

Chairman at Heligan Partners

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