Every constituent of the company can be negatively affected by the uncertainty that surrounds a change of ownership. Key employees may leave, vendors and financing sources may become more stringent in their terms, customers may become uneasy about future orders. And of course, a competitor can make things even more difficult by telling prospective customers that his/her company is stable and that yours may not be.
On the buyer’s side, there may be an existing employer or partner. Buyers have legitimate reasons to disclose their actions only at appropriate times, and not before.
In the case of larger firms, the practices of the merger and acquisition industry prevail. The identity of the company for sale is kept confidential except to a few qualified prospective bidders.
From the moment we are engaged by either a buyer or seller, we put in place our strict confidentiality policies and procedures. For example, before releasing sensitive information about a business for sale, we require that a prospective buyer sign a non-disclosure agreement (“NDA”). In addition, we discuss the prospective buyer’s identity with the seller when there is a concern about possible involvement by a competitor who might simply wish to find out more about the seller.
If you would like to have a no-charge phone session to explore how we maintain confidentiality in the purchase and sale of businesses, our broker in charge of business sales, Gary Richards, will be happy to talk with you.
He has directed the marketing and sale of more than a hundred businesses, and has developed proven methods to achieve results.