CBA Sale Advantage+
Price, Terms, and Taxes - The Three Legged Stool
It’s not the price you get for your business, it’s the price you net in the end. Often overlooked in the early stages of a business sale, the terms and taxes play a critical role in what you walk away with at the sale. Smart buyers are trained in leaving out critical deal elements from their offer, that affect the economics of the deal. They come back weeks before closing with terms or tax allocations (possibly working capital) not in your favor.
California Business Advisors helps protect sellers by having the Price, Terms, and Taxes discussion early with your trusted advisors to figure out the best position for you. Is it a stock sale or an asset sale? Is it all cash or payments over time? What’s your tax position and how will the sale be allocated? There’s many questions that need to be covered. Additionally, its as important to discuss these with each buyer, setting a pin for the LOI or offer. To move forward with the transaction, a buyer has to put each in writing.
CBA will host a conference call or a meeting with Company’s Ownership and Company’s accounting firm to formulate a strategy to maximize the net after tax proceeds. Discussion points will include proposed Transaction Structure, Purchase Price Allocation, and the Net Working Capital calculation and formulation.
