Practice · 03
Business sale and purchase
The deal is decided in the heads of agreement. The contract records it. Call before the first one is signed.
For buyers and sellers of small and mid-sized businesses across New South Wales.
The work
Buying a business is buying a set of promises: that the customers are real, that the equipment works, that the lease can be transferred, that the staff will stay, that the seller will not open across the road. Selling one is making those promises and being paid fairly for them. The contract is where each promise either gets written down or quietly left out.
The practice acts on both sides, though never both sides of the same deal. For a buyer, that means due diligence that looks for the problems that change the price, and a contract with warranties that mean something. For a seller, it means a clean data room, a contract that limits what you are on the hook for after completion, and a restraint you can live with.
Fees are fixed stage by stage: heads of agreement, due diligence, contract, completion. Each is quoted before it starts.
This work includes
- Heads of agreement
- Due diligence
- Business sale contracts
- Asset sale or share sale
- Restraints on the seller
- Employees and entitlements
- Transferring contracts and licences
- Stock, plant and intellectual property
- Vendor finance and earn-outs
- Completion and handover
How it usually runs
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Before the price is agreed
The best time to call. The heads of agreement, the deposit terms and the conditions are where a deal is really decided. Once those are signed, the contract mostly records them.
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Due diligence, sized to the deal
For a buyer: the contracts, the lease, the employees, the licences, the debts and anything that would change the price. For a seller: getting the same things in order before a buyer's lawyer finds them. Not a box-ticking exercise. A list of what could go wrong, ranked.
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The contract
Drafted or reviewed, then negotiated. Warranties, adjustments, restraints, what happens to staff, what the seller must do after completion. A fixed fee for the contract stage is agreed once the shape of the deal is known.
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Completion
The checklist, the transfers, the notices, the handover. The practice does not hold client money, so the funds step on completion is handled by a settlement agent arranged at the start of the matter, with the practice coordinating around it.
Where the line is
- The practice does not receive or hold client money. Deposits and completion funds go through a settlement agent or the other side's trust account, agreed in writing at the beginning so nobody assumes otherwise.
- Where the business comes with a lease, the lease assignment runs through The Leasing Lawyer, the practice's dedicated leasing site, alongside the sale.
- A sale that collapses into a court dispute goes to a litigator on the panel with the file prepared.
Nobody pays anybody for a referral here, in either direction. How the practice hands work on →
Common questions
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Should I sign the heads of agreement the broker sent?
Not before someone has read it. Some heads of agreement bind, some do not, and the difference is in the wording rather than the title. Exclusivity, deposit and confidentiality clauses are often binding even when the rest is not. A short review before signing costs far less than being held to terms you thought were only a starting point.
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Asset sale or share sale?
In an asset sale you buy the business and choose which liabilities come with it. In a share sale you buy the company, and everything in it comes too, known or not. Buyers usually prefer assets and sellers usually prefer shares, for tax and liability reasons that your accountant and the practice work through together. There is no default answer.
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What happens to the employees?
In an asset sale they are usually terminated by the seller and re-employed by the buyer, and the contract has to say who wears their accrued leave and service. In a share sale they stay employed by the same company. Either way the Fair Work Act has rules on transfer of business that shape what can be agreed, and getting this wrong is a common source of post-completion disputes.
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How long does a business sale take?
Weeks rather than days. Four to eight is typical for a straightforward sale once heads of agreement are signed, with the lease assignment and any licence transfers often the slowest step. Complicated deals run longer. You will be given a realistic timeline at the outset and told when it moves.
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Make an enquiry
Send a short note about what is happening. You will hear back within one business day, and there is no charge for finding out whether the matter is a fit.