Getting the Most out of a Business Purchase or Sale
August 20th, 2019

By Kevin Walsh. 

Buying or selling a business is one of the biggest financial decisions you can make. To get the most out of the deal, you need the right professional advice and support. For more than 35 years, Walsh King has helped clients with purchases and sales. Recent deals we have worked on range in value from $1.5 million to $1.7 billion.

The extent of our role in a purchase or sale depends on:

  1. Deal size
  2. Deal complexity
  3. The client’s internal resources
  4. The client relationship
  5. The nature of financing


Conventional Purchase/Sale Process


Most purchases and sales consist of the following stages:

Client selects broker

Broker establishes data room, an electronic record of information for due diligence

Broker produces confidential information memorandum (CIM) and “teaser” for prospective buyers

Broker canvasses market

Broker identifies short list of potential buyers

Both sides negotiate letter of intent (LOI)

Lawyers get involved

Due diligence begins

Deal closes


Walsh King’s role in purchases and sales includes offering a variety of tax and business advice. We’re ready to help at all stages of the process, from choosing a broker and negotiating deal terms to preparing tax filings after the transaction has closed.

Tax adviser

As part of planning for a purchase or sale, we calculate safe income—the amount of dividends that can be paid tax-free to another corporation—to determine the best tax structure. We also determine whether to use the lifetime capital gains exemption (CGE) or multiply the CGE among beneficiaries by setting up a trust. Our other pre-planning services include tax deferral strategies and quantifying the difference between an asset sale and a share sale.

The planning process calls for working with tax advisers on the other side of the transaction. Generally speaking, this relationship is collaborative, not adversarial.

Confidante to the entrepreneur

We help business owners determine why and when to sell, and to evaluate alternative sale strategies. Besides sharing our experience with the entrepreneur, we reduce demands on their time by “translating” legal and financial information and the components of the deal process.

Among the business advice and other support we provide:

  1. Assessing legal options
  2. Focusing negotiations on information relevant to the deal
  3. Reducing emotional reactions
  4. Assistance in populating the data room 
  5. Guidance throughout the process

Supporting the internal accounting and finance team

Walsh King’s role here depends on the accounting and finance team’s skill and capacity, and the nature or complexity of the deal. Some examples of support:

  1. Normalizing EBITDA (earnings before interest, taxes, depreciation and amortization) by adjusting it to exclude one-time and non-cash expenses
  2. Projections
  3. Working capital
  4. Schedules for legal agreements
  5. Cash flow calculations

Introducing and helping select a broker, law firm and banker 

After identifying appropriate brokers, law firms and bankers, Walsh King makes introductions and helps the client choose the right candidates.

Negotiating deal terms

When acting for the vendor, we evaluate the letter of intent and the suitability of the purchaser. In addition to recommending counter-offer points, we coordinate with the vendor’s lawyers. Post-LOI, we evaluate the purchaser’s proposed changes.

When acting for the buyer, we provide input to their lawyers on the offer terms and assist in responding to the vendor’s proposed changes. Post-LOI, we evaluate the related purchase agreement and ensure consistency with the LOI. 

Reviewing legal documents

Legal documents are drafted by the purchaser’s lawyers and reviewed by the vendor’s lawyers. We offer input to the latter and help resolve roadblocks, sharing our perspective with the client. We also prepare schedules for everything from payments to patents and trademarks, and review the documents in detail for all tax, accounting or related provisions.

Due diligence

Due diligence is the purchaser’s focus. Managing the process means minimizing tangents that are not material to the transaction. It’s also important to anticipate due diligence issues in advance.

When acting for the vendor, we assist in ensuring that they answer the buyer’s questions in a satisfactory manner and may help provide and propose documentation to satisfy the buyer’s concerns. 

When acting for the buyer, we help with tax and financial due diligence and make sure that the final purchase agreement explains and addresses any uncertainties. 


If acting for the purchaser, we prepare or assist with the financing application, make bank presentations, negotiate credit terms and review the term sheet.

If acting for the vendor, we determine whether they stay financially committed. If so, we review the purchaser’s credit facility and identify and negotiate the terms of any vendor take-back financing.

Closing process

Closing includes preparing or reviewing flow of funds, ensuring that the final implementation steps are consistent with the purchase agreement.

When acting for the vendor, we often assist with preparing the flow-of-funds analysis. 

When acting for the buyer, we help them get ready for the post-closing transition.


After the deal has closed, we complete any required tax filings and prepare and implement the cash distribution strategy. We also prepare and file tax elections such as GST, and section 22, 85 or 97 of the Income Tax Act, which cover purchases and sales.


Having advised our clients on hundreds of business purchases and sales, we know that each deal is unique. With that in mind, we tailor our services to your individual situation.  

If you’re planning to buy or sell a business, it’s never too early to seek professional advice. To learn more about how we can help, contact Walsh King today.

Posted in Strategic Insights + Walsh King

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