The exit strategy

At a point when many business owners are now considering a sale of their companies, our experience at Pierce Corporate Finance shows that real value can be driven through the transaction if the shareholders adopt a strategic plan for the sale.

Rather than the process starting when you put the business on the market, shareholders should take specific action so that business value can be maximised. In headline terms, a business owner should consider the following:

  • Personal financial planning: are you extracting value in a tax efficient manner through dividends, pension contributions and the like.
  • Shareholdings: are the shareholdings structured so that taxation is minimised.
  • Shareholders agreement: is there a formal agreement that limits the ability of an individual to hold the other shareholders to ransom?
  • Financial controls: have you implemented robust financial controls that are fit for purpose and will stand up to scrutiny through the disposal process.

Irrespective of the reason for a business sale, whether through the age of the shareholders or a change in personal circumstances there are several options available to shareholders, which include:

  • Passing the business to a family member (family succession)
  • Disposal to a competitor or strategic investor
  • Management buyout
  • Closure and liquidation of the assets

At Pierce Corporate Finance we will work with you to consider the routes for exit and help you identify:

  • Objectives - what are your goals. The reason for exiting can help identify objectives and steps to be prioritised
  • imeline - when is the end goal. The business owner must allow for flexibility in the process
  • Market conditions - is your business delivering robust financial results that will attract potential buyers and underpin the valuation