Executive Summary: A successful sale or purchase of a business is high-stakes and technically demanding. Two lead advisors make the difference: an M&A lawyer to steer legal strategy, documents, diligence and negotiation; and an M&A deal advisor to run valuation, buyer outreach, competitive bidding (where appropriate) and the overall process. Engage them early. Even a focused 3–6-month preparation window can materially improve outcomes.
Reach out to us at WhatsApp at +65 8079 0028 if you would like to book a confidential consultation.
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Why a strong team matters
Selling a business is one of the most challenging and emotional decisions an owner will make. The process is intricate and mistakes can be costly. Much of the information available is fragmented or not directly applicable to your facts, and some steps require professional expertise.
Working with experienced advisors in mergers and acquisitions Singapore gives you clarity on the why, when and how of an exit, and equips you to negotiate competitive terms and manage a smooth transition of ownership. Whether you’re planning to sell my business Singapore or exploring opportunities to buy and sell business in Singapore, assembling the right team is the foundation of deal success.
Starting preparation well in advance is ideal, but even a shorter ramp-up delivers tangible benefits. Early work sharpens the sale rationale, aligns buyer type and price expectations, and ensures you approach the market with organised materials and a realistic timeline.
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Role 1: M&A lawyer — the legal lead
Your M&A lawyer guides you through the legal workstream from start to finish. Typical responsibilities include:
- Structuring and salient terms
Advising on transaction structure and key terms, and whether the deal should proceed via a share purchase agreement (SPA) (also known as a sales and purchase agreement) or an asset purchase agreement (APA) (also known as an asset transfer agreement). Understanding the share sale vs asset sale implications is critical for tax efficiency, liability transfer, and post-completion obligations.
- Drafting and reviewing documents
Preparing the SPA/APA and ancillary transactional documents, and reviewing counterparty drafts to ensure terms align with mergers and acquisitions in Singapore law and practice.
- Legal due diligence
Facilitating the legal due diligence process using a comprehensive data room checklist and preparing or reviewing the legal due diligence report so issues are identified and managed early.
- Issue resolution
Advising on ongoing or pending litigation and regulatory issues related to the business, particularly when you sell private limited company shares with inherent liabilities.
- Negotiation
Negotiating transaction terms on your behalf from initial heads of terms to signing and closing.
Choosing counsel. Look for a lawyer with a track record of completed M&A transactions across different deal sizes and industries. Many sellers prefer counsel who are transparent on fees, detail-oriented, highly responsive and experienced in closing deals. A practical step is to ask for a list of past transactions and the lawyer’s specific role in each. If you already have a trusted lawyer for other matters, you can instruct them to collaborate with your M&A specialist.
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Role 2: M&A deal advisor — the financial and process lead
Your M&A deal advisor (often called a corporate finance adviser) manages the financial strategy and the sale process so you can focus on running the business. Scope typically includes:
- Valuation and goal-setting
Ascertaining the business valuation Singapore or company valuation Singapore and discussing your objectives for the sale—whether full exit, partial rollover, or strategic partnership.
- Buyer universe and meetings
Vetting, shortlisting and meeting prospective buyers from the advisor’s network, ensuring alignment with your goals when you sell my business Singapore.
- Competitive bidding (if needed)
Facilitating competitive bidding among buyers to improve certainty and price.
- Deal structuring and negotiations
Assisting in deal structuring (including share sale vs asset sale considerations) and handling negotiations, working alongside your lawyer.
Engaging a capable advisor helps maintain business performance during the sale window. Even where the contemplated buyer is a family member, existing shareholder or employees, professional input on structure and process remains valuable.
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Preparation: materials and data room
A disciplined market-preparation phase typically includes:
- Preliminary financial due diligence using a questionnaire to capture key information about the business.
- Marketing documents prepared from that information:
- a fact sheet/teaser (1–2 pages with key financials and background),
- a confidential information memorandum (IM) with expanded details, and
- a management presentation deck for meetings with prospective buyers.
- A virtual data room (VDR) to consolidate and exchange information required for due diligence.
This work surfaces areas for improvement you can address early and gives you a clearer sense of valuation before engaging buyers.
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Go-to-market options
Your advisory team will recommend one of three approaches:
- Targeted solicitation
A curated short list of qualified strategic buyers.
- Advantages: faster and more confidential.
- Trade-off: less competition may result in a lower valuation.
Limited auction
A larger group of qualified strategic buyers with relevant industry knowledge.
- Advantages: greater confidentiality than a broad process; efficient workflow; partnership-oriented engagement.
- Trade-off: fewer bidders may reduce negotiating leverage and deal certainty.
Broad auction
The least selective approach to reach a broad pool of buyers.
- Advantages: stronger negotiating leverage, higher probability of closing, and potentially higher proceeds.
- Trade-off: longer process and reduced confidentiality.
A key advantage of engaging an experienced advisor in mergers and acquisitions Singapore is access to a robust list of qualified, reputable buyers—something that materially influences outcomes when you’re ready to buy and sell business in Singapore.
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From teaser to term sheet
Preliminary buyer marketing begins once materials are ready:
- The fact sheet is distributed to prospects; interested parties sign an NDA to receive the IM.
- In auction scenarios, a bid process letter sets the timetable, number of rounds, data-room access protocols, contact details and the terms to include in offers.
- After reviewing the IM, buyers engage with the deal team to better understand the opportunity and clarify information.
- Buyers submit non-binding indications of interest (IOIs).
- The deal team analyses IOIs, clarifies ambiguities with competitive bidders, and presents a shortlist for the next round.
Further buyer marketing then follows:
- Management presentations and facility tours provide a deeper understanding of operations and leadership.
- Buyers receive more extensive VDR access. VDRs are customisable; sensitive information can be redacted or restricted for certain parties based on your data room checklist protocols.
- Serious buyers invest time and resources in the VDR because the information is material to their final bids.
- Buyers submit term sheets, which are more detailed than IOIs and set out proposed terms in greater depth. Receipt of term sheets signals tangible market interest.
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From selection to closing
- Your deal advisor and lawyer review term sheets to assess purchase price, deal structure (particularly share sale vs asset sale mechanics) and any movements from IOI to term sheet.
- The most competitive term sheets are taken into final negotiations.
- Upon executing a term sheet with the shortlisted buyer, the buyer typically enjoys exclusivity for a defined period to complete due diligence and submit the draft definitive agreement.
- Negotiating and executing the definitive agreement is one of the final steps, reflecting principles of mergers and acquisitions in Singapore law and practice.
- Closing completes the transaction, typically via transfer of the business or transfer of the company’s shares to the buyer when you sell private limited company holdings.
A typical process of this nature takes at least six months to one year, with individual stages varying by deal size and complexity.
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Valuation: SDE, EBITDA and EBIT (plain-English overview)
Advisors commonly use earnings-based methods to normalise performance and compare with peers when conducting business valuation Singapore or company valuation Singapore exercises:
- Seller Discretionary Earnings (SDE)
Used predominantly for smaller businesses (e.g., those earning below S$1 million per financial year as a rule of thumb).
- Starts with net profit and adds back the owner’s salary, non-recurring expenses, interest, taxes, depreciation, amortisation and other owner benefits.
- A multiple of SDE gives a valuation range.
- Illustrative example: a bakery with S$400,000 SDE at 2.5–3.0× implies ~S$1.0–1.2 million.
- For deals below ~S$1 million, it may be more cost-effective to limit the scope of legal, financial and/or tax due diligence. This is a judgement call balancing risk and transaction costs.
- EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortisation)
Typically used for businesses with more than S$1 million in earnings.
- Focuses on operating profitability and excludes owner compensation.
- Value is estimated by applying an industry-informed multiple to EBITDA.
EBIT (Earnings Before Interest and Taxes)
Similar to EBITDA but excludes depreciation and amortisation.
- Often used for asset-intensive businesses with high depreciation tied to maintaining operations.
- If high depreciation reflects growth rather than maintenance, EBITDA may still be more appropriate.
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Readiness that improves outcomes
A preliminary valuation done one to two years before you intend to sell my business in Singapore gives you time to execute a value-creation plan. Such plans can yield material uplifts over the initial business valuation Singapore. Even three to six months of focused action helps. Practical steps include:
- Increase revenue
- Expand sales volume.
- Emphasise long-term contracts to improve revenue quality.
- Optimise pricing methods.
- Enhance capital efficiency
- Reduce costs and optimise inventory.
- Improve cash-flow management with customers and suppliers.
- Improve profit margins
- Optimise production flow.
- Reduce production and operational costs.
- Increase product quality.
Executing these steps shows buyers that your company can deliver additional value under continued management, increasing confidence in the business’s future and supporting a stronger company valuation in Singapore.
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Personal and financial reasons to sell (aligning motivations)
Common personal reasons include retirement (or semi-retirement by transitioning into a limited advisory role) and management fatigue. On the financial side, strong performance—such as three years of solid financial results—is a positive indicator for valuation, and selling when the business is performing well often supports a higher price. Another financial rationale is to unlock growth that current resources can’t support; a buyer with deeper capital or network can elevate the business, and with an appropriate structure you may participate in future growth.
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Practical checklist for appointing your team
When selecting an M&A lawyer:
- Ask for past M&A transactions and each lawyer’s specific role.
- Prefer genuine mergers and acquisitions Singapore experience, transparent fees, attention to detail and responsiveness.
- Consider having your usual lawyer collaborate with the M&A specialist.
When selecting an M&A deal advisor:
- Confirm they will ascertain valuation, clarify your sale goals, curate and meet buyers, run a competitive process if needed, assist with structuring (including share sale vs asset sale analysis), and handle negotiations, so you can continue focusing on the business.
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Book a strategy call if you’re considering a sale in the next 3–24 months, we’ll scope the team you need, the materials to prepare, and the timeline from first outreach to closing so you enter the market ready.
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FAQ
1) When should I hire an M&A lawyer and an M&A deal advisor?
As early as possible. Starting well in advance is ideal, but even 3–6 months of focused preparation with the right advisors delivers tangible benefits when navigating mergers and acquisitions Singapore transactions.
2) What’s the difference between an SPA and an APA?
An SPA (share purchase agreement, also called a sales and purchase agreement) documents a sale of company shares. An APA (asset purchase agreement, also called an asset transfer agreement) documents a sale of specific business assets. Your lawyer will advise which share sale vs asset sale route suits your situation under mergers and acquisitions in Singapore law and practice.
3) What is a virtual data room (VDR), and why do I need one?
A VDR is a secure online repository used to consolidate and exchange due-diligence information organized according to a comprehensive data room checklist. It supports efficient buyer review and allows you to control access and, where necessary, redact sensitive information.
4) How long does a typical sale take?
A well-run process usually takes at least six months to one year, with timelines varying by deal size and complexity.
5) What are IOIs and term sheets?
An IOI (indication of interest) is a non-binding, conditional expression of interest. A term sheet is more detailed and sets out proposed terms in greater depth. Receiving term sheets indicates tangible market interest.
6) Do I need a competitive auction?
Not always. Options include targeted solicitation, limited auction, and broad auction. Each has confidentiality, speed and valuation trade-offs. Your advisor will recommend the route that best fits your goals when you sell my business Singapore.
7) How is my business valued?
Advisors commonly use SDE, EBITDA or EBIT to normalise earnings and then apply an industry-informed multiple for business valuation Singapore or company valuation Singapore purposes. The method depends on business size and characteristics (for example, asset intensity).
8) Can smaller deals limit diligence to save costs?
For businesses valued at less than about S$1 million, it may be more cost-effective to reduce the scope of legal, financial and/or tax due diligence. This is a judgement call balancing lower costs against the increased risk of not conducting full diligence.
9) Can I sell and still stay involved?
Yes. Depending on the buyer and structure, some owners transition to a limited advisory role when they sell private limited company shares, which is useful for those seeking semi-retirement.
10) What do I do first?
Engage your advisors, complete a light information pack, prepare the teaser/IM/management deck using a proper data room checklist, and set up your VDR. This organised start improves valuation discussions and keeps the process on track when you’re ready to buy and sell business in Singapore.
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Reach out to us at WhatsApp at +65 8079 0028 if you would like to book a confidential consultation.
Disclaimer: Our articles are intended for your general information only. They are not intended to be nor should they be regarded as or relied upon as legal advice. These articles neither constitute nor substitute independent legal advice, and you should still seek independent legal advice for your legal matters. You should consult qualified legal professionals before taking any action or omitting to take action in relation to the matters discussed in our articles.
