SALE AT SPEED
Released On 22nd Mar 2023
Financial uncertainty can be a stressful time for anyone involved with running a business and knowing when to take advice is key. Directors can be reluctant to speak with the Restructuring team at Milsted Langdon due to a perception that this is the first step on the road to the failure of that business, however, the knowledge and experience that we have can enable a variety of options to be explored, if we are approached early enough.
One area that we have seen an increase in activity in over the last 12 months has been with business owners seeking to sell their company or business, on an accelerated basis. The reason for such a sale is varied, but could be due to a decline in forecasted cash flow, uncertainty over future prospects or accelerated retirement planning due to poor health. Whatever the rationale for the sale, there is usually a viable underlying business that would make an attractive proposition to the right purchaser.
An accelerated sales process is, with the exception of the timescales involved, largely the same as any other business sale process. Where a traditional sale might seek to conclude a sale over a number of months, however, in an accelerated scenario the timeframe is compressed, often to a number of weeks. The aim of the process remains that of achieving the best value for the business on sale.
Whilst our aim in any sale scenario is to maximise the return to the owners, in some cases it may be necessary to complete the negotiated sale as part of an insolvency process, often referred to as a pre-pack administration. Such an outcome is not necessarily a poor result, as the negotiated sale will ensure that the creditors of the company achieve the best possible outcome.
The key message that we would convey in respect of an accelerated sale process, is that the sooner a business owner talks to the team at Milsted Langdon about the financial health of their business the more options and time to plan a managed exit will exist and the better the prospects will be of achieving the desired outcome.
