How does a company sale work and what needs to be considered?
February 24, 2022 | 30,00 EUR | answered by Chloé Schmitt
Dear lawyer,
My name is Marie König and I am the managing director of a medium-sized GmbH. After many years of successful management, I have decided to sell my company. However, I am now faced with the challenge of not knowing exactly how a company sale works and what steps need to be considered.
The current situation is as follows: I have found potential buyers for my company and am about to initiate the sales process. However, I am unsure about what contracts need to be drawn up, how the sale price is determined, and what tax aspects come into play.
My concerns mainly lie in not wanting to make any legal mistakes that could lead to problems later on. I also want to ensure that the sales process runs as smoothly as possible and is fair for both parties.
Therefore, my question to you as an expert in corporate law: How exactly does a company sale work and what needs to be considered? What contracts need to be drawn up, how is the sale price determined, and what tax aspects need to be taken into account? Are there any possible pitfalls I should watch out for, and what solutions are there for them?
I thank you in advance for your support and look forward to your expert advice.
Sincerely,
Marie König
Dear Mrs. König,
Thank you for your inquiry regarding the sale of your GmbH. As a specialist in corporate law, I am happy to assist you in successfully navigating the sales process.
Selling a company is a complex process that requires careful planning and execution. It is important to first clarify your goals and expectations. Do you want to sell the entire company or just a part of it? What sales price are you aiming for and what conditions should be included in the contract?
Next, you should enter into confidentiality agreements with potential buyers to protect sensitive company information. Additionally, you will need to sign a letter of intent to establish the framework for the sale.
The sales contract should clearly outline important points such as the purchase price, payment terms, transfer date, warranties and guarantees, as well as any clauses related to succession planning. It is advisable to seek support from an experienced attorney to avoid legal errors.
The sales price can be determined in various ways, such as based on the company's value, earnings value, or asset value. The tax aspects of a company sale are also crucial. It is recommended to consult with a tax advisor early on to make tax optimizations and avoid potential tax pitfalls.
Potential pitfalls to watch out for include unclear language in the contract, inadequate due diligence reviews, or unexpected liability risks. Careful planning and thorough preparation can help minimize these risks.
In conclusion, it is important to conduct the sales process transparently and fairly to earn the trust of buyers and ensure a smooth transition. I am here to support you at every step of the sales process and ensure that your interests are protected.
I hope this information has answered your questions, and I am available for further information.
Best regards,
Chloé Schmitt
