Asset sales
Although this section is aimed at buying going concern entities many parties are interested in the assets only, including plant, customer order book, business name, etc.
Although most asset sales occur once a business has closed there is an opportunity to acquire assets even if the IP is seeking a sale as a going concern. The IP’s primary duty is to realise as much as possible for the assets of the business for the creditors. If an offer is higher for assets on a break up basis compared to a going concern the IP would have to give it careful consideration (the additional liabilities of closure must also be taken into account).
Care should always be taken if the business is continuing to trade due to the risks associated with the transfer of the employee liabilities. Professional advice should be obtained.
Purchasers should also ensure that they do not underestimate the costs of moving a business in terms of actual cost and loss of customers, etc. The timetable for removal should also be considered and negotiated.
In terms of valuation of assets, if not familiar with the market the purchaser should take advice from specialist valuers to ensure that the offer for the offer is appropriate.
