Support for selling a business
Support for selling a business is for owners who have decided to sell a company, a share in an LLC, a property complex or an online project and want a fair price without unnecessary risk. An experienced buyer always performs a review, and if the business is not ready for it the price drops and the deal drags on or falls through.
The client receives a company prepared for sale, an audit report and an investment memorandum that can be shown to the buyer, plus the agreements and the registration of the transfer of title. MK Audit has supported business sales for more than 20 years, including sales to foreign investors; lawyers and auditors work as one team, and confidentiality of the transaction is a basic condition of our work.
What is included
- assessment of the business’s readiness for sale and a preparation plan;
- putting the documents in order: contracts, leases, licences, trademark rights, HR records;
- a tax audit and a voluntary audit of the financial statements before the sale, so that the buyer finds no surprises;
- transformation of the statements to international standards if the buyer is foreign;
- preparation of the investment memorandum: description of the business, market share, competitors, strengths, growth prospects;
- business valuation using several methods;
- deal structuring: sale of a share, of assets, or creation of a new debt-free company to be transferred to the buyer;
- participation in negotiations, drafting of the sale and purchase agreement and the parties’ warranties;
- registration of changes in the register and handover to the buyer.
Who needs it
- owners of LLCs selling the whole company or a share to a partner or an investor;
- foreign companies leaving Ukraine and selling a subsidiary or a representative office;
- groups of companies selling a non-core business line;
- non-profit organisations and charitable foundations transferring a social enterprise or a property complex to another organisation; the donor needs the transfer of assets to be documented transparently, and a grant audit helps here;
- owners of online projects, trademarks and franchises.
Selling with and without preparation
| Stage | Without preparation | With preparation |
|---|---|---|
| Buyer’s review | Finds errors in the accounts and documents, demands a discount | Risks already removed, the auditor’s report confirms the state of affairs |
| Price | Often reduced after due diligence | Supported by a valuation and a memorandum |
| Deal timeline | Drags on because of additional requests | The buyer receives a ready document package |
| Seller’s risks after the deal | Buyer’s claims under warranties | Warranties limited, contentious issues settled in advance |
Examples from our practice
- Sale of a printing complex. Before the sale a new debt-free legal entity was created, permits, equipment, staff and customer contracts were transferred to it, an audit was performed and a memorandum prepared. Within a month two foreign buyers were found, both performed due diligence, and the company was bought by the one who offered the better price.
- Sale of a logistics complex. A tax audit and a transformation of the statements to international standards were performed and an investment memorandum was prepared. Within six months the company was bought by Western European investors.
- Sale of online projects. Rights to domains and trademarks were put in order, tax and legal issues resolved, after which the projects were sold to investors within two months.
How the work proceeds
- Request and proposal. You describe the business, the desired timeline and the terms of sale. We send a commercial proposal with a preparation plan within 1 day.
- Contract and checklist. We sign a confidentiality and engagement agreement and send you the list of documents for analysis.
- Execution. We perform the audit, put the documents in order, prepare the memorandum and valuation, and support the buyer’s review and the negotiations.
- Result and support. Signing, receipt of payment, registration of changes, handover. If needed we help the buyer with accounting so that the transition is smooth.
Documents you will need
- charter, register extract, ownership structure;
- financial statements and tax returns for two to three years;
- list of assets, title documents for real estate, equipment and land;
- leases, licences, permits, trademark certificates;
- key contracts with customers and suppliers, loan agreements;
- staff list, information on key employees;
- bank and tax statements on the status of settlements, if available.
Timing
Preparing a small company for sale takes one to two months. Finding a buyer and closing the deal depend on the market and usually take two to six months.
Leave a request in the form below: a commercial proposal after we review the task, reply within 1 day.
Will employees and competitors learn about the sale?
Not unless you want them to. We sign a confidentiality agreement, and buyers receive information in stages and only after signing non-disclosure undertakings.
Why an audit if the buyer will do its own review anyway?
To find and fix problems before the buyer finds them. An error found by the seller costs a correction; an error found by the buyer costs a price discount.
Can we sell only part of the business?
Yes. You can sell a share in the LLC, a single business line or assets, or spin part of the business off into a new company and sell that.
Do you help find a buyer?
We prepare materials for buyers and present the business to interested investors, including through partners in DFK International, but our main task is to prepare the company so that any buyer confirms the price.