Over the years, we have supported entrepreneurs at various stages of their journey: growth, restructuring, dispute… and ultimately, exit.

When a business leader consults us with a view to selling their company, the first discussion often centers on valuation.

Our recommendation is always the same:

The asking price is not the net result. The structure determines what you actually retain.

1. Structure Before You Negotiate

Before going to market, we recommend analyzing:

• The contemplated sale structure (share sale vs. asset sale)
• The actual tax implications
• Post-transaction liabilities
• Existing contractual obligations

A decision made too quickly can significantly reduce the net outcome.

2. Confirm Eligibility for the Capital Gains Exemption

Many entrepreneurs assume they will qualify for the capital gains exemption.

Our experience shows that eligibility must be rigorously verified:

• Nature of the assets held
• Percentage of active vs. passive assets
• Corporate history
• Intercompany transactions

Advance planning can make a significant difference.

3. Anticipate Due Diligence

A serious buyer will conduct a thorough review:

• Tax compliance • Payroll obligations
• Contractual commitments
• Potential disputes
• Client concentration

Our recommendation: conduct a preventive audit before listing the business for sale.

Issues discovered by the buyer become negotiation leverage.

4. Approach the Letter of Intent with Caution

The letter of intent (LOI) is often perceived as a formality.

We recommend treating it as a strategic document.

Certain clauses may:

• Limit negotiating flexibility
• Create binding exclusivity
• Frame the transaction in ways that become difficult to reverse

Negotiation begins at the LOI — not at closing.

5. Plan 12 to 24 Months in Advance

Our consistent recommendation:

Preparation for a sale ideally begins one to two years before the transaction.

This allows you to:

• Optimize tax structuring
• Adjust asset composition
• Strengthen shareholder agreements
• Increase perceived value

A prepared business sells better.

And under stronger terms.

Conclusion

The sale of a business is often one of the most significant financial events in an entrepreneur’s life.

At PME Avocats, our role is to structure that transition with method, rigor, and foresight.

We recommend an early strategic assessment for any entrepreneur considering a sale within the next 24 months.