Preparing your hotel company for sale

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Selling a hotel company is no small project, whatever the size of the hotel. Firstly, the commercial terms of the deal must be agreed with the purchaser and the sale and purchase agreement and other related documents will be much negotiated between the parties (and their solicitors). However, it is the due-diligence process that will often take up most of the seller’s time. The purchaser will, understandably, want to investigate the company and the hotel business that it is buying to ensure that everything is in order, and it is not unusual for legal due-diligence questionnaires to be dozens of pages long.

Sellers often find that so much management time is taken up with responding to these enquiries that the business suffers, which is detrimental to both seller and purchaser. Therefore, it is of great advantage to get your house (or, rather, your hotel) in order in advance, before time becomes of the essence.

Being able to present a clean, transparent and well-organised company will reassure a purchaser and may help to reduce the post-completion warranty risk borne by the seller. Considering the following matters when preparing your hotel company and its subsidiaries for sale will be the first step in achieving a smooth transaction…

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