Selling a business is a complex process that combines financial, legal, human, and psychological challenges. For both the buyer and the seller, negotiation is the most delicate stage, where the success or failure of the deal is decided.
Although each case is unique, the experience of practitioners makes it possible to identify best practices to maximize the chances of success.
1. Enter into the negotiation with realism and pragmatism
A business sale negotiation never follows a linear path. Last-minute changes, the seller’s constraints, or conflicts between advisors are common. The buyer must show flexibility and adaptability, while staying firm on financial goals.
Regular communication with stakeholders is essential to adjust the strategy and maintain trust.
2. Adopt a clear strategy and a structured working method
Starting a negotiation without a strategy means wasting time and energy. The buyer must :
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define priorities (price, financing terms, timeline),
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identify non-negotiable points,
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prepare to arbitrate between several deals.
A methodical approach ensures better control of the timeline and helps anticipate necessary concessions.
3. The importance of support from specialist advice
An M&A advisor, a business lawyer, or an experienced accountant play a decisive role. They ensure compliance with the process, secure financial and tax aspects, and help both parties stay focused on what matters most.
However, it is important for the buyer to remain fully involved : delegating too much can be seen as a lack of interest or understanding of the project.
4. Selecting the target company
Before entering a negotiation, it is essential to decide to set aside other opportunities. An acquisition is time-consuming and costly, and running several negotiations in parallel is counterproductive.
The choice of a target should be based on clear criteria :
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fit between the business model and the buyer’s skills,
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development potential, location,
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financial coherence with the investment capacity.
A detailed Letter of Intent (LOI) formalizes this choice and opens the way to the exclusivity phase.
5. The letter of intent : an essential milestone
The Letter of Intent (LOI) is not a final commitment, but it formalizes the willingness to move forward. It sets the foundation of the negotiation and offers the buyer an exclusivity period, essential to secure the project.
It should specify in particular :
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the scope of the sale (shares, exclusions, off-balance-sheet items),
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the base price and adjustment terms,
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the conditions precedent (financing, prior restructuring),
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the seller’s commitments (support, non-compete),
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the timeline of steps up to the closing.
6. Control audits : securing the operation
Audits (financial, legal, tax, social, environmental) confirm the information provided by the seller and identify potential risks. They must be proportionate to the size and nature of the company : an SME does not require the same depth of audit as a large group.
An organized data room provided by the seller facilitates this stage, reduces tensions, and speeds up the process. The buyer should participate to better understand the company’s daily operations and avoid later disputes.
A poorly managed procedure (sensitive questions, lack of confidentiality, disproportionate demands) can create tensions or even jeopardize the transaction.
7. The transfer protocol : formalizing the final agreement
The share purchase agreement (SPA) is the final and most delicate stage. Drafted by advisors (lawyer, M&A consultant), it faithfully reflects the outcome of the negotiations and sets the definitive commitments.
It may include :
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price adjustments,
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warranty clauses,
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conditions precedent,
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ancillary agreements (leases, management contracts, shareholders’ agreements).
At this stage, psychological tensions may arise : the seller’s fear of losing control, or the buyer’s fear of risk. A calm setting, regular breaks, and professional guidance help overcome these obstacles.
The signing of the agreement marks the conclusion of the negotiations. Each clause must be clear and precise, as any ambiguity can lead to future disputes.
THE EVALIANCE CAPITAL APPROACH
NEGOTIATING WITH RIGOR AND FORESIGHT
The success of a business acquisition relies on a subtle combination of strategy, method, and psychology. The Letter of Intent, the audits, and the agreement are all key stages where rigor must prevail.
By relying on specialized advisors, staying personally involved, and prioritizing transparency, the buyer maximizes their chances of success. Anticipating, structuring, and securing each stage not only preserves the company’s value but also builds lasting trust between seller and buyer.
Negotiation is not a confrontation, but a constructive process, where each party seeks to secure its future.
