Below are some examples of the opportunities and challenges we respond to on behalf of business and wealth owners, their families and their other advisers.
A UK client sold his interest in a trading company for a mix of cash, loan notes and shares.
We helped him reduce his tax bill on the cash proceeds to 10% by using entrepreneur’s relief and deferred the remaining capital gains tax by rolling it over into other investments.
Our client wanted to sell her substantial interest in a UK company. She then planned to retire overseas.
We advised her to sell her interest in three tranches. The first up front, the second as part of an earn-out, and the final – and largest – tranche when she was no longer UK resident.
Several reliefs are available to reduce or defer capital gains tax on the disposal of a trading business.Damian Bloom, Partner - Head of Private Client
If you’re leaving the UK, it’s often better to delay disposing of assets until you’re sure you’ll be gone for long enough.Damian Bloom, Partner - Head of Private Client
Our client planned to sell her business but was concerned that a key contract – to supply a customer with industrial materials over several years – was flawed. Disclosing the flaw to a potential buyer would hit the sale price, but she might face a costly dispute if she failed to disclose and it later came to light.
We advised on how to fix the problem ahead of a sale – although it took an arbitration to do so.
Our client wanted to sell a business that was involved in an ongoing dispute. We advised on how to manage the issue.
We made a full disclosure to the potential buyer. We also agreed limits on our client’s total liability, made sure our client could continue to run the dispute, and took out warranty insurance where possible. The sale went ahead, subject to a reasonable retention until the case was settled.
However complex the deal, limiting warranties by time and money is one of the keys to minimising liability.Jonathan Morris, Partner - M&A and Corporate Finance
Your level of ongoing risk is determined by the balance between disclosure, warranties and indemnities.Adam Bogdanor, Partner - M&A and Corporate Finance
We advised the trustees on the sale of a business held by a family trust.
A key issue was how to frame the warranties. The trustees gave warranties on trust-related issues, while family-member directors gave warranties on business related issues – on the basis that ultimately the trustees would bear the cost of any warranty claims.
The trustees who held a family’s property business received an attractive – but time sensitive – offer for the business. They wanted to accept but not all the beneficiaries agreed.
We advised the trustees on an urgent application to court to approve the sale, on the grounds that it was in the beneficiaries’ best interests. The court agreed and the sale went ahead. The court approval protected the trustees against a claim from the disgruntled beneficiaries.
Trustees need time to respond to a sale proposal: always confide in them early.Tracey Neuman, Associate Director - Private Client
Trustees are often cautious sellers; they have more onerous responsibilities than an individual sellerJonathan Morris, Partner - M&A and Corporate Finance
Our client wanted to sell part of a complex property-portfolio to a commercial-property specialist. We restructured the portfolio to put all the commercial properties into a new vehicle and advised on its sale.
The residential and development properties were retained in the existing company.
A successful entrepreneur wanted to get her business ready for a full AIM listing in two to three years.
We advised her on how to make the shares more attractive to investors. She bought out several smaller shareholders over several years, settled outstanding claims against the business, and restructured the management team and their contracts.
Complexities in a business lead to complexities on a sale. A thorough business audit is a crucial pre-sale step.Jonathan Morris, Partner - M&A and Corporate Finance
Unresolved disputes can have a disproportionate impact on sale value.Jonathan Morris, Partner - M&A and Corporate Finance
“Complexities in a business lead to complexities on a sale. A thorough business audit is a crucial pre-sale step.”Jonathan Morris, Partner - M&A and Corporate Finance