BUY & SELL BUSINESS IN UAE

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1. Pre - Sale Preparation

This stage involves getting your business ready for the sale . Look at the different components of your business.

• How is it all working ?
• What are the weak points ?
• Where are improvements needed?
• What can be done now to make things better?

Consider if you have the basics in place.

• A clean corporate structure and requisite licences / authorizations to carry on the business
• Transparent and clean accounting practices and an audited set of financial statements
• A good set of commercial agreements with customers and suppliers
• Adequate protection for your brand and intellectual property
• Proper policies and employment terms for your employees

Identify the key risk areas following the analysis above , and strive to fix them , using internal or external help.Consider if you need to engage Smart Group in some form of restructuring to help with the sale/purchase process.

2. Teaser / Information Memorandum

Put together a summary, teaser or information memorandum together, with the assistance of your financial advisor / broker. This should be a short document that describes what your business is and the opportunity it represents . It should give enough information to create interest while being anonymous and confidential.

3. Identify Buyer ( s ) and Sign Term Sheet / MOU

Work with Smart group - your financial advisor to identify potential seller / buyer ( s ) and agree an auction / bid process (if there is more than one interested party). Prior to disclosing any information , sign confidentiality agreements with all interested parties. Once a bidder has been chosen, sign a term sheet with that party.

4. Due Diligence

The due diligence process involves a review of your business ' information by the buyer, to confirm the basis on which an offer has been made. The due diligence would cover financial, legal, commercial, operational areas of the business.This will typically involve the preparation by the buyer / its advisors of a list of questions and requests for copies of documentation.

Smart group has the team of experienced professional who will present you a due diligence report, which will give you a true and fair view of all financial, legal, and operational areas.

5. Share Purchase Agreement and Disclosure Letter

During or after the due diligence phase, parties will begin negotiating the Share Purchase ( or Sale and Purchase ) Agreement ( SPA ). This is the document that will ultimately govern the terms on which the shares are sold . The document will outline the payment terms , completion arrangements and the warranties and indemnities to be given by the seller. Negotiations over warranties and indemnities can be lengthy and this is often the biggest issue in agreeing the final documentation. The key ' insurance policy ' for the seller, in relation to the warranties, is through disclosure. This involves the preparation by the seller's lawyers of a disclosure letter which sets out exceptions to the factual statements in the warranties and shifts the risk to the buyer. This will also be subject to negotiation and can take considerable time to finalise.

6. Signing

Once the SPA and disclosure letter are in agreed form (and the loose ends in the due diligence process have been tied up) , the parties can sign the SPA. However, that in most cases, this does not mean the deal has completed.

7. Conditions

There may be a gap between signing of the SPA and actual completion of the deal (i.e. when you get paid and the shares / assets are transferred to the buyer). This period allows the seller and buyer to complete any conditions to the sale (for example, obtaining third party approvals, fixing any operational issues , etc).

8. Completion

Once the conditions have been completed, the parties would attend the offices of the relevant authority to sign the transfer forms, and would also sign any ancillary documentation (board resolutions, resignation letters, appointment letters, etc ).

The answer to the timeline question is, be prepared to spend up to 6 months on this process. It may be less or it may be more . It depends on a number of factors including