The Course of a Company Sale: From Preparation to Closing

Selling a company is not a side project. A professional sale process (M&A process) follows a clear sequence — and precisely this structure protects value and negotiating position. Those who know the process make better decisions and avoid the typical mistakes.

1. Preparation and readiness

Before any buyer approach comes the preparation: get the figures in order, formulate a robust equity story, reduce dependence on the owner and organise all documents for the later review. A well-prepared company not only achieves a better price — it also moves faster and more securely through the process.

In this phase, an anonymised short profile (teaser) and a more detailed information memorandum for serious interested parties often take shape.

2. Valuation and strategy

In the second phase you clarify what is realistic and what the goal is: full sale, partial sale or an investor on board. The valuation delivers a value corridor from asset value, earnings value/DCF and market multiples; the strategy determines which buyer types are approached.

How the value comes about is set out in „What is my company worth?"; which buyer type suits which goal in „Strategic Buyer or Financial Investor?".

3. Buyer approach — discreet and curated

In phase three, suitable buyers are identified and approached confidentially, secured by a non-disclosure agreement (NDA). Discretion here is value protection, not style: if a sale becomes known too early, it unsettles employees, customers and suppliers.

Rather than broad scattering, a curated selection of the right counterparts is the better route. How the buyer search works systematically is shown in „How Do I Find the Right Buyer?".

4. Letter of Intent (LOI)

Serious interested parties submit an indicative, non-binding offer; with the most promising one a letter of intent (LOI) is agreed. It records the key points — price framework, structure, timetable, exclusivity — before the deeper review begins.

What a non-binding offer achieves is deepened in „Indicative Offer"; the LOI is explained in „Letter of Intent".

5. Due diligence

In due diligence the buyer examines the company carefully: finance, law, tax, contracts, personnel, sometimes technology and market. Here the preparation from phase 1 pays off — clean documents create trust and prevent subsequent price discounts.

What is examined is described in „What is a Due Diligence?".

6. Negotiation and purchase agreement (SPA)

The purchase agreement (share purchase agreement, SPA) governs not only the price but also warranties, liability and the structure — such as an earn-out, in which part of the price is tied to future performance. It is negotiated in parallel with or after due diligence.

7. Closing and transition

With signing and fulfilment of all agreed conditions the transaction is completed (closing): ownership and purchase price change hands. After that comes the orderly transition — knowledge, customer relationships and responsibility are handed over.

How long does a company sale take?

From preparation to closing usually takes six to twelve months on the market; with an experienced adviser like IGCP, three to six months are possible. The duration depends on complexity, buyer search and depth of review.

The scale of the handover wave is considerable: for 2025 to 2034, according to BMWET and KMU Forschung Austria, some 52,500 Austrian businesses are due for handover — many of them through a sale. More on duration in „How Long Does a Company Sale Take?".

Selling a company is the most important transaction of an entrepreneurial life. Have it accompanied independently and discreetly — IGCP Capital Partners. → igcp.at

Frequently asked questions

How does a company sale work?

In seven phases: preparation, valuation and strategy, discreet buyer approach, letter of intent (LOI), due diligence, negotiation of the purchase agreement (SPA), and signing and closing with a subsequent transition. The biggest lever lies in the preparation.

What is the difference between a strategic buyer and a financial investor?

A strategic buyer pursues operational goals such as market access, products or customer access. A financial investor invests for returns, often with a growth and exit perspective over a number of years. Both can be the right partner — the competition between them protects the value.

What does earn-out mean?

Part of the purchase price is paid subject to success, tied to the company''s future development after closing. It bridges differing price expectations but shifts risk to the seller.

How do I preserve discretion?

Through anonymised approach via a teaser, non-disclosure agreements (NDA) and a curated, small buyer selection instead of a broad market approach. This keeps control over sensitive information with the seller.

Do I need an M&A adviser?

A structured process with several bidders usually lifts the price well beyond the adviser''s cost. What an adviser does and costs is shown in „M&A Adviser" and „What Does an M&A Adviser Cost?".