Ownership & Management Considerations
A buyer needs to have an understanding of their desired New Co-ownership and management structure.
Define the Structure
When considering buying a business, understanding the legal structure of the NewCo something to discuss with an Attorney and all relevant parties of NewCo ownership. Points of Consideration to evaluate when determining the best ownership structure: is there a family trust to consider, are there any outside investors in NewCo, will the Seller maintain any ownership interest, and what is the best structure from a tax management perspective.
Management Structure
Owner/operator whereby you will replace any duties of former owner? Or Passive investor and need management to stay in place, or willing to bring in new management?
Transaction Requirements of Seller
How long do you want the Seller and any Key Managers to provide training in order to effectively transition the business. Any desired schedule? How much are you willing to pay during the training period?
Relocation
Are you willing to relocate? How much time is needed? How will that impact a transition plan?