Business Purchase & Sale

Why engage Sheehan & Co to represent you in the purchase or sale of a business?

Whether you are looking to purchase a new business or selling your enterprise, it is important you obtain independent and professional legal advice to ensure the transaction process addresses all relevant issues and proceeds to settlement in an efficient and hassle-free manner.

Checklist of questions you should consider when purchasing or selling a business

We ask the following questions at the outset so that all issues that relate to your transaction are properly addressed in the Contract:

  • What licences, permits, authorities, consents or assignments are needed to operate the business and how will they be obtained? For example, lease assignment, material contracts, food and liquor licences, Council permits?

  • Have you considered the risks associated with employees and Work Health and Safety. For example, retention of key staff, whether there are signed employment agreements and the nature of the entitlements therein (that is, sick leave, long service leave and annual leave entitlements - how will these entitlements be adjusted under the terms of the Contract?) and whether the employees are under the correct award?

  • Have you obtained advice from your accountant as to the commerciality of the business, the appropriate vehicle (for example, partnership, company, family trust, unit trust...) to operate the business (if you are buying a business) from both a taxation viewpoint and a risk management viewpoint?

  • What are the assets of the business? Are any assets of the business to be excluded from the sale/purchase? Have any representations been made to or by you regarding what assets are included or excluded?

  • Are there any risks with the purchase price and payment terms? For example, is the purchase price 100% cash, cash and shares or cash plus the value of stock-in-trade?  Are there deferred payment terms to consider? Is Vendor finance applicable?

  • If there is to be a stocktake, when will the stocktake be effected and who will carry out the stocktake? If an expert is required to be engaged, who pays the cost of the expert? Are you only buying good and saleable stock-in-trade? Do you have the right to reject items which are not good and saleable?

  • What are the financial commitments and liabilities of the business, including treatment of debtors and creditors? Have you obtained appropriate financial/taxation advice from your accountant/financial advisor in relation to these important issues?

  • Are there any litigation or insolvency/bankruptcy risks? 

  • Have you conducted due diligence enquiries in relation to the business being purchased? For example, has your accountant sighted, considered and provided you with advice in relation to the financial statements of the business for the past 3 financial years, if available?

  • Do you require the Contract to be made conditional upon you obtaining satisfactory due diligence enquiries by a certain date? This may enable you to engage your accountant to conduct an audit of the financial records to verify the accuracy of the financial statements supplied by the Seller - this is extremely important.

  • Have you considered obtaining warranties from the Seller in relation to the financial information pertaining to the business, whether the assets of the business included in the sale are in good going order and condition...?

  • Have you considered what risks you may be exposed to if any of the Seller's warranties prove to be incorrect? How good is the Seller's warranty - if the Seller is a company, have you obtained the Seller's director's guarantees which can be relied upon if there is a breach of warranty?

  • How will the transition to takeover of the business work under the terms of the Contract? Do you require pre or post settlement training by the Seller (if you are buying a business)? Do you require a trial period?

  • Do you wish to restrain the Seller from operating a business in competition to the business being purchased for a fixed period of time and within a designated area after settlement of the Contract? Have you considered the risks associated with any restraint provisions, including enforceability of the restraint provisions if there is a subsequent breach by the Seller?

The above is not intended to be an exhaustive list as the issues which will be relevant in relation to each transaction may vary.

Establishment of a business - asset protection/structuring services

Sheehan & Co also provides business and corporate clients with asset protection/structuring advice working in with your accountant/financial advisor.

In general terms, the establishment of a business  consideration of a range of factors, including:

  • Asset protection issues - for example, is the structure of the business appropriate either as a start-up business or as the vehicle for purchasing the business?

  • Ease and cost of administration;

  • Taxation implications;

  • Type of business activities (degree of risk);

  • Employee and debtor obligations.

Our services in this area are tailored to achieve better outcomes for you

It is important that you receive advice on your rights and liabilities at the beginning of any business purchase or sale, preferably before you execute any contractual documents. Sheehan & Co provides you with the necessary advice. 

Paul Sheehan and his team have a high level of knowledge and experience in advising in the purchase and sale of businesses in a range of industries, including:

  • Rural/Agricultural enterprises (for example, cattle grazing businesses, farming businesses, piggeries...);

  • Transport businesses;

  • Professional Service businesses;

  • Retail businesses (for example, bakeries, cafes, butcheries; hairdressing salons...);

  • Real Estate Businesses;

  • Franchises;

  • Hotels;

  • Motels; and

  • Various businesses located within retail shop lease centres (addressing, in particular, Retail Shop Leases Act 1994 (Qld)).

Paul Sheehan and his team can help navigate you through the process of purchasing a business to ensure your new enterprise gets going without unnecessary headaches.


Remember - it pays to get the right advice!