A Successful Aviation Business Exit Through Documentation
Many business owners spend their lifetime building their companies. When it comes to selling their business, it could be an emotional journey for them.
In this article, we will discover one of the most important steps, which plays a huge part of your successful business exit, and yet being undermined by so many business owners.
When business owners think about selling their company, it is important to remember that well-prepared documentation is a key to their success.
These documents are there to demonstrate your business effectiveness, valuation, and potential growth of your company. One of the biggest benefits of having well-prepared documentation is to provide clarity and reduce the number of questions, which will save you tremendous time in going back and forth with potential buyers.
Understanding the Aviation Business Sale Process
Before delving into the specifics of the required documents, let's take a moment to understand the essential stages of selling an aviation business. This intricate journey involves meticulous pre-sale planning, strategic marketing to potential buyers, negotiating terms, rigorous due diligence, and finally, closing the sale. At each juncture, providing detailed and comprehensive documentation is key to ensuring a seamless transition.
Preparing for a Successful Sale
The preparatory phase for selling your aviation business is pivotal and demands a considerable investment of time and effort. Here, the emphasis lies in creating a robust foundation through comprehensive documentation. This not only offers a clear and transparent view of your business's current performance but also instills confidence and trust in potential buyers, potentially maximizing the final sale price.
1. The Executive Summary
The executive summary serves as the key documentation to give potential buyers a good overview of your company. There is no one-size fit all creation in this document, but it allows the business owner to be creative in telling the story about your company including history, the business itself, leadership, licenses, revenue streams, business partnership, assets, organisation structure, financial snapshot and possibilities for expansion and growth.
Financial Statements:
Financial statements, including balance sheets, income statements, and cash flow statements, serve as the backbone of the sale process. They provide nuanced insights into your business's financial health from various perspectives. To provide a consistent financial picture the company should provide financial statements for the last 3-5 years.
2. Business and Strategic Plans:
Your aviation business and strategic plans act as the guiding beacons, outlining the mission, vision, operational structure, marketing strategies, and growth projections. These plans serve to showcase your business's potential for future success.
3. Tax Returns:
Prospective buyers anticipate reviewing tax returns for the past three to five years. These documents corroborate financial statements, offering a transparent view of your business's earnings, expenses, and profitability.
4. Contracts and Agreements:
The contractual landscape, including client and supplier contracts, lease agreements, and employment contracts, provides a comprehensive view of your business's obligations, entitlements, and commitments.
5. Intellectual Property Documentation:
Documentation related to intellectual property, such as trademarks, patents, copyrights, and trade secrets, significantly enhances your business's value by validating exclusive rights.
6. Regulatory Documents and Permits:
Staying compliant with industry regulations is non-negotiable. Up-to-date licenses, permits, and regulatory documents serve as a testament to your business's adherence to legal standards.
7. Organisational Documents:
Articles of Incorporation, Articles of Organisation, and the training manual offer insight into your aviation business's legal structure, ownership, and governance procedures.
8. Asset Inventory:
A comprehensive inventory encompassing physical, digital, and intangible assets paints a vivid picture of your business's value. This aids potential buyers in understanding the array of resources they stand to acquire.
The Role of Confidentiality Agreements
Confidentiality agreements emerge as the unsung heroes in this narrative, playing a crucial role in safeguarding sensitive information during the sale process. By binding buyers to maintain confidentiality, these agreements become the guardians of your business's competitive position.
Due Diligence and the Importance of Documentation
The due diligence phase marks a period of intense scrutiny by potential buyers. Thorough and organised documentation becomes the catalyst, expediting this process, substantiating your business's worth, and fostering the trust necessary for a successful sale.
Working with Brookfield Aviation Finance
The great news is not all of those documents are required to be provided at the beginning of the sale process. By working together with our seasoned experts at Brookfield Aviation Finance, we will guide you step by step throughout the preparation phase, and increase your effectiveness in this complex process.
Using this methodical technique increases the probability that your aviation company will be sold for the highest potential values that you want to achieve. Recall that an aircraft company without prepared documentation could unintentionally convey a less-than-professional image, which could turn away potential customers. Investing in thorough paperwork makes your company look good on the outside and makes it stand out as a desirable candidate in the cutthroat aviation industry.
If you are considering selling your company, contact our expert today.
