Financial planning, business independence and negotiation with buyers are key to selling a company
Diego Gutiérrez, M&A Partner at Baker Tilly Spain, participated in an interview with Emprendedores magazine, in which he discusses the main aspects that owners considering selling their company should take into account. During the conversation, he analyses the different stages of a business sale and purchase transaction, from the initial preparation of the business to negotiations with potential buyers and the closing of the transaction.
How to prepare a company for sale and align the interests of its owners
One of the first aspects highlighted is the need to define shareholders' objectives before starting a sale process. Establishing who wishes to leave the company, who wants to remain and what each owner's financial expectations are is essential to avoid disagreements during the transaction.
In this regard, our partner emphasises the importance of agreeing on minimum conditions and shared rules that enable coordinated decision-making. Having a shareholders' agreement that addresses these situations can help prevent deadlocks and facilitate the process.
Financial preparation and the business plan before selling a company
Financial information is another essential element in preparing a company for sale. Diego explains that the financial statements must reflect the reality of the business, follow accounting standards and allow its performance to be analysed, providing potential buyers with a clear picture of the company.
This information should be accompanied by an explanation of the business strategy, its distinguishing features, its position in relation to competitors and the reasons why customers choose its products or services.
He also highlights the importance of preparing a three-year business plan that considers different scenarios and makes it possible to assess both growth expectations and potential risks that could affect the projected results.
Business independence as a factor in company valuation
Another aspect addressed in the interview is the company's dependence on its owner. Diego Gutiérrez points out that overseeing a company should not mean that all decisions, commercial relationships or operational activities depend exclusively on one person.
An organisational structure capable of continuing to operate after the founder's departure provides greater certainty for potential buyers. Preparing for a sale therefore also involves reviewing internal processes, the organisation, product development and potential legal risks.
In this context, our partner stresses the importance of having a qualified team and retaining key personnel to ensure business continuity after the transaction.
How to find buyers and evaluate acquisition offers
During the interview, Diego also explains how the search for potential buyers is conducted. Once the company has been prepared, an information memorandum (infomemo) is drawn up. This confidential document outlines the characteristics of the business, its distinguishing features and the financial information required for investors to submit an initial offer.
Potential buyers should be identified selectively, assessing which companies or investors may have a genuine interest in the business. The aim is to attract three or four interested parties to create competition during the process.
Our partner also points out that the highest financial offer is not always the most advantageous. When evaluating acquisition offers, it is also important to consider the payment structure, any deferred payments, amounts linked to future performance and the buyer's plans for the company.
Due diligence and risks in a business sale and purchase transaction
The final stage of the process includes due diligence, a detailed review through which the buyer verifies the information provided and assesses the company's situation. Diego warns that this stage may reveal problems or lead to attempts to renegotiate the terms, making thorough preparation and well-organised documentation particularly important.
Throughout the conversation, our partner also identifies the main factors that can influence a company's attractiveness. Key risks include deteriorating financial performance, revenue concentration among a small number of customers and technological or cybersecurity vulnerabilities.
Conversely, a stable and diversified customer base, a team with decision-making capabilities and transparent, consistent financial information help provide the certainty that buyers seek.
The full interview offers further insight into the different stages of selling a company and the importance of preparing the business in advance, not only to secure favourable financial terms but also to ensure its continuity beyond the founder's involvement.
You can read the full interview published in Emprendedores: Read the interview
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