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Closing turns the letter of intent into a signed purchase agreement and a completed transaction. The buyer’s advisers confirm their diligence, the lawyers negotiate the agreement, and any consents the transaction needs are obtained.

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What happens

1

Confirmatory diligence

The buyer and its advisers complete their review, often including their own quality of earnings work and legal, technology and tax diligence.
2

Purchase agreement negotiated

Your lawyer and the buyer’s lawyer negotiate the purchase agreement and its disclosure schedules. We track the open points on the purchase agreement issues list in your portal and help you weigh the commercial ones.
3

Third-party consents

Some contracts, leases and loans require the other party’s consent to a change of ownership. We identify these early so they don’t hold up the closing.
4

Regulatory approvals, if required

Many transactions of this size need none. Your lawyer will confirm early whether any apply, and if one does, the timetable allows for it.
5

Signing, funds flow and close

The agreement is signed, the funds flow statement sets out who is paid what, and the transaction closes. Signing and closing may happen on the same day or some weeks apart.

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Your advisers at closing

We coordinate the process, but legal and tax advice come from your own advisers. Bring them in early:
  • An M&A lawyer to negotiate the purchase agreement. Experience with transactions of this kind matters more than familiarity with the company.
  • Your accountant or tax adviser to advise on the structure of the sale and its tax consequences for you, ideally before the letter of intent is signed.

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What we need from you

  • Input on the disclosure schedules. These list the exceptions to the statements you make about the company in the purchase agreement. Complete, accurate schedules are your best protection after closing.
  • Quick decisions on open points. The issues list makes clear which ones are commercial and which are legal.
  • Continued focus on the business. The buyer will still be watching results until the day the transaction closes.

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What can go wrong

Often based on findings from the buyer’s own quality of earnings review. Disclosing issues early, and in some cases a sell-side review, can leave less room for it. See Quality of earnings.
A landlord, lender or key customer whose consent is needed and who takes their time. We identify these early and plan when to ask.
Definitions that weren’t settled in the letter of intent. See From price to proceeds.
Closing is long and detailed, and it comes at the end of months of work. Keeping a clear issues list, and deciding commercial points quickly, keeps it moving.