Unsolicited business offer: what should you check before replying?

01

Return to your objectives as an owner

Do you still want to grow the business, reduce your role, plan succession or explore liquidity? The answer may change how you read the proposal.

Receiving an offer is not evidence that selling now is your best option. Compare continuing the business and other scenarios that matter to you.

Ref. [2]

02

Verify the buyer’s identity, role and financing

Clarify the interested party’s identity, role and strategic interest, and how it expects to finance the purchase and proceed. An initial approach differs from a documented proposal.

• Is the party acting for itself or someone else?
• What information is requested, and for what purpose?
• What scope and timetable does it propose?

03

Read beyond the headline number

An amount may be subject to conditions, future payments or adjustments. Ask what it includes and what could change it. Financing conditions, diligence and your role after a transaction deserve attention alongside the initial number.

Ref. [1]

04

Check proposed terms before sharing information

Information requests, confidentiality and potential exclusivity can limit your options. Ask appropriate advisers to examine documents and their effects before making a commitment.

The title “letter of intent” does not determine a document’s legal effect. Do not assume every provision has no effect, and do not send sensitive information through a public form.

Ref. [1]

05

Prepare a decision rather than a reaction

Organize the unresolved questions, relevant information and professionals to consult. Existing advisers can contribute, with their responsibilities clarified.

Owner Value & Options Review can help frame your choices. A reference point on value may also be useful within an agreed engagement. This work guarantees neither price, transaction nor timing.