Guide · Founders and owners
Preparing to sell a company
The twelve months before you go to market decide the price more than the negotiation does. This guide puts the steps in order and links each one to the page that covers it in full.
- 4
- Steps
- 21 October 2026
- Updated
Most owners sell a business once. The buyer, their advisers and their lenders have done it many times, and the gap shows up in the details: how profit is measured, what counts as debt, how much working capital has to be left behind.
Work through the steps in order. Each one links to a page that covers it in full, with worked examples and sources. Steps are added as new material is published.
- 1
Work out what a sale is actually worth to you
Offers are quoted as an enterprise value. What reaches you is that figure after cash, debt, debt-like items, the working capital adjustment and your own costs. In the calculator's worked example, a £42m headline becomes £32.8m in the bank.
What to do
- Run your latest balance sheet through the EV to equity bridge.
- List every loan, lease and liability a buyer could call debt-like.
- Decide the minimum proceeds you would accept, after costs and before tax.
- 2
Get your numbers ready before a buyer looks at them
Buyers rebuild your profit as sustainable, transferable earnings in a quality-of-earnings report, and every adjustment is multiplied by the price multiple. Make the arguments first, with evidence.
What to do
- Commission a sell-side quality-of-earnings report.
- Build an evidence file for every add-back: board minutes, contracts, salary benchmarks.
- Fix revenue recognition, accruals and cut-off issues while there is still time.
- 3
Agree how working capital will be measured
The peg decides how much working capital you must leave in the business — and in a growing or seasonal business, a trailing average can quietly cost you money.
What to do
- Plot monthly working capital for the last two years.
- Agree the line-by-line definition alongside the price, not at the end.
- Model the peg on the month you actually expect to close in.
- 4
Know who buys businesses like yours
A serial acquirer that keeps what it buys is a different owner from a private equity fund that plans to sell in five years. Shortlist buyers by what they buy and how they run acquired companies.
What to do
- Filter the acquirers database by your sector and country.
- Read each shortlisted buyer's own acquisition criteria.
- Note which buyers keep management in place, and which integrate.
Frequently asked questions
How long does it take to prepare a company for sale?
Start well before you go to market — ideally around a year ahead. Getting the numbers ready, commissioning a sell-side quality-of-earnings report and fixing what it finds take the longest, and the sale process itself comes after that.
What should I do first when preparing to sell?
Work out what a sale is actually worth to you after debt, debt-like items, working capital and costs. It sets a realistic floor and shows which balance-sheet items matter most before you talk to any buyer.