Consider this if…
- You have agreed heads of terms and need the sale agreement drawn or reviewed
- You are buying and want to know what you are actually acquiring
- You are selling and want to know what you will still be liable for afterwards
- The business operates from leased premises and the lease has to be assigned
- There are employees and nobody has worked out what happens to them
- You have been asked to sign a restraint and do not know how wide it is
How it works
Tell us the shape of the deal
What is being sold, whether it is the business assets or the shares in the company, the price and how it is being paid, and whether premises and staff are involved. Send anything already agreed in writing — heads of agreement bind more often than people expect.
Same or next business day
Due diligence
For a buyer: what you are acquiring and what comes with it. Contracts, licences and permits, the lease, employee entitlements, intellectual property, litigation and any encumbrances over the assets.
1–3 weeks, depending on scale
The sale agreement
Drafted or reviewed. Price and payment, what is included and excluded, conditions, warranties, restraints, apportionments, and what happens if something is not as described.
3 business days for a review
The lease and the staff
Assignment of the lease and the landlord's consent, which runs on the landlord's timetable rather than yours. Employee entitlements settled between the parties so nobody discovers them at completion.
Run in parallel — start early
Completion
Stocktake and adjustments, transfer of the assets or shares, keys, handover, and the notifications that follow.
On the completion date
Fee
Quoted in writing before we start
GST inclusive
Excludes: Government charges, search fees and any duty payable are separate and charged at cost.
Quoted in writing before we start. If the deal is unusual we will say so and explain what makes it so, rather than quoting low and revising later.
Turnaround
Our written view on a sale agreement within three business days.
Asset sale or share sale
This is the first decision and it changes almost everything downstream.
In an asset sale, the buyer takes the components — goodwill, plant and equipment, stock, contracts, the lease, the intellectual property — and the selling entity stays behind with its own history, its liabilities and its tax position. The buyer starts clean. This is why buyers prefer it.
In a share sale, the buyer takes the company. Everything continues uninterrupted: contracts do not need assigning, employment does not change, the lease usually stays where it is. But the buyer also inherits everything that happened before them, including liabilities nobody has found yet. This is why sellers prefer it, and why a share sale needs harder due diligence and stronger warranties.
Neither is automatically right. What matters is that the choice is made deliberately, and priced accordingly, rather than defaulting to whatever the first draft assumed.
The lease is the thing that derails sales
Most business sales that fall over do not fall over on price. They fall over because the lease could not be assigned in time, or at all.
The lease sets out the assignment process. The landlord's consent is usually required, and the landlord can generally require information about the incoming tenant — financials, references, sometimes a personal guarantee. Our guide to commercial lease assignment explains the consent, documents, security and release issues in detail. None of this is unreasonable, but it takes time, and the landlord has no stake in your settlement date.
Two things follow. Start the assignment as early as possible, before the agreement is finalised if you can. And sellers should check whether they remain liable after assigning — in many leases the outgoing tenant stays on the hook, which means selling the business does not end the lease exposure. That is worth knowing before you agree a price.
Due diligence, and what it is actually for
Due diligence is not a formality and it is not about distrust. It is about finding out whether the business will keep earning after you own it.
The questions that matter most:
- Does the revenue survive the sale? Key contracts often contain change of control provisions. A customer who can walk on a change of ownership is revenue you may not be buying.
- Can you operate it? Licences, permits and registrations the business needs. Some do not transfer.
- What is owed to the staff? Accrued leave and long service is a real number and it has to be dealt with in the agreement.
- Do they own what they are selling? Business names, trade marks, domains and software are frequently held personally, or by a related entity, or not owned at all.
- What is registered against the assets? Security interests, leases of equipment, retention of title arrangements.
- What is on foot? Litigation, disputes, regulatory issues, and anything brewing.
The agreement
Price and how it is paid. Deposit, balance at completion, and any deferred component. Earn-outs and vendor finance both spread risk and both need drafting carefully, because they depend on the performance of a business the buyer now controls.
What is included, and what is not. Specifically. Ambiguity here shows up on the day of completion, when it is least convenient.
Conditions. Finance, landlord consent, due diligence, transfer of a licence. Each needs a date, and the dates need to be achievable.
Warranties. The seller's statements about the business, and what happens if they turn out not to be true. Sellers negotiate to limit them; buyers rely on them.
Restraints. How long, how wide, and what activity. A seller who intends to stay in the industry needs to know exactly what they are signing away, and a buyer needs a restraint that will actually be enforced rather than one so broad a court will not enforce it at all.
Apportionments and stock. Rent, outgoings, prepayments and a stocktake at completion.
For sellers
Preparation is worth more than negotiation. A business with clean records, transferable contracts, a lease with time left on it and a documented staff position sells faster, more reliably, and for more.
The things that reduce price at the last minute are almost always things that were knowable at the start: a lease expiring in eight months, a key contract that terminates on a change of control, entitlements nobody has quantified.
For buyers
Two rules. Do not sign a heads of agreement thinking it is not binding — parts of it usually are. And do not let the lease assignment be the last thing anybody looks at.
Frequently asked questions
What is the difference between an asset sale and a share sale?
In an asset sale the buyer acquires the things the business is made of — goodwill, equipment, stock, contracts, the lease — and leaves the selling entity behind with its history. In a share sale the buyer acquires the company itself, and everything that comes with it, including liabilities that predate the sale. Buyers usually prefer asset sales and sellers usually prefer share sales, for exactly that reason. Which one applies changes the agreement, the duty position, the tax outcome and what happens to the staff.
What does due diligence actually involve?
Checking that what you are buying is what you have been told. The lease and whether it can be assigned. Key contracts and whether they survive a change of ownership. Licences and permits the business needs to operate. Employee entitlements. Intellectual property, including whether the business name and trade marks are actually owned. Litigation, disputes and security interests registered over the assets. How long it takes depends on the size of the business, but skipping it is where most buyer regret originates.
What happens to the lease?
Usually it has to be assigned, and that needs the landlord's consent. The lease sets out the process and what the landlord can require — often financial information about the buyer, and sometimes a personal guarantee. This is the step that most often delays or derails a sale, because the landlord is not a party to your deal and has no reason to work to your timetable. Start it early. A seller should also check whether they remain liable under the lease after assigning.
What happens to the employees?
In an asset sale employees do not automatically move across. The buyer decides whom to offer employment to, and their accrued entitlements are either recognised by the new employer or paid out by the seller — that is negotiated and should be settled in the agreement, not discovered at completion. In a share sale the employer does not change, so employment simply continues.
Do I pay stamp duty when I buy a business?
It depends on what is being transferred. Victoria does not impose duty on the transfer of most business assets such as goodwill. Land transfer duty applies if the sale includes land, and landholder duty can apply to a transfer of shares or units where the entity holds significant land. GST is a separate question — a sale may qualify as a going concern, which has conditions and requires agreement between the parties in writing. We work out the position for your transaction rather than assuming.
Is a restraint of trade enforceable?
Sometimes. A restraint on a seller is more readily enforced than one on an employee, because a buyer is entitled to protect the goodwill they have paid for. Whether a particular restraint holds up depends on how long it runs, how wide an area it covers, and what activity it prevents. A restraint drawn too broadly can fail entirely, which is a problem for a buyer who assumed they had one, so it is worth drafting properly rather than copying something wide and hoping.
Related services
Send anything already agreed in writing, and tell us if there is a lease or staff involved.
Tell us about the deal