How to transfer your business in international context ?

There are many different ways to transfer your company. Let’s take a look at all the different ways to find a buyer for your SME.

Transferring your company in an international context is a methodical and legal procedure: you’ve assessed the company’s objective value, conducted a performance diagnosis, and sought potential buyers. Now it’s time to consider the actual structure of the transfer.

The structure largely depends on your buyer. We’ve outlined the three most common scenarios for you.

1. Passing on Your Business to Your Children

If one or more of your children work with you, they might be interested in taking over your enterprise. In many countries, this option presents several fiscal and economic benefits. You can transfer your company in the following ways:

• Gratis: The transfer is considered a donation and is subject to general taxation and transfer duties (-50% if the donor is under 70 years old). However, a deduction is permitted if the recipient commits to retain the shares. If the company’s assets don’t exceed a certain amount, the capital gains are usually tax-exempt.
• For a fee: This type of transfer can assume various forms and financial arrangements. It’s advisable to engage a team of experts for guidance. They can inform you about the possibility of transferring the company to a holding company in the form of an OBO (Owner BuyOut).

2. Transferring Your Business to a Third Party

When contemplating international business transfer, a small or medium-sized enterprise manager may have no alternative but to seek an external buyer. It’s crucial to present prospective buyers with a viable plan for the company’s future. It’s also advisable to engage a team of specialists to guide you through the necessary steps:

• Company preparation and valorization
• Presentation of the company to prospective buyers
• Discussion period with a potential buyer
• Company audit and memorandum of understanding outlining the purchase terms and other contractual guarantees
• Company transfer in the presence of a notary, and filing of the deeds at the commercial court’s clerk’s office and the Trade and Companies Register
• Payment of registration fees

3. Transferring Your Company to Your Employees

If your employees express interest, they can take over the company through several methods. Since they already understand the company’s operations, the transition period is typically smoother. In Europe, typically, the transfer to employees can occur through a donation, but more often, it’s a transfer that enables the owner to enhance the company’s value. This can take the form of:

• Employee Buyouts: Managers pool their resources to acquire the company.
• Leveraged Buyout: The buyers use the company’s assets as collateral to finance the purchase.

In conclusion, the methods of company transfer are numerous and vary based on the countries and profiles of the buyers. Don’t hesitate to contact Actoria, which assists with an average of 50 company transfer, sale, capital opening, or family transmission cases per year through its team of consultants across Europe.