Acquiring an existing company

When you set up your own business you have to deal with a number of issues which are relevant for every entrepreneur. For more information, see the section Setting up your own business. If you decide to go into business by acquiring an existing company, you need to thoroughly prepare for this specific aspect.

Everybody who buys a company goes through a number of preparation phases. You should pay particular attention to the following questions.

• You can find which companies are for sale by consulting mergers and acquisitions agencies, banks and accountants. You can also ask your Chamber of Commerce to provide information about the opportunities on the company fair.
• Are you interested in a business that is for sale? If so, you should act quickly and effectively, as you are probably not the only interested party. If the seller wants to sell in a hurry, this could put pressure on the asking price.
• Define your assumptions and preconditions and make sure you know exactly what you want to do with the business. Make a business plan. Ask for specialist advice.
• Make sure you have a clear picture of the company you are interested in. Why does the current owner want to sell? How big is the business? Who are its customers? Who are its suppliers? How many people work there? What is the financial situation?
• Consult a business adviser when negotiating with the seller. Ask a number of advisers for a quotation. Make clear agreements with the adviser of your choice. Do not choose an open-ended proposal, make definite agreements on the scope of the advice.