Preparation
Who’s on your deal team?
You already know how to run your company. Running a sale process is a different skill, and you will need people around you who have done it before.
Running a business and running a sale process will test you in different ways. Your company has spent years proving it can operate and is performing well. The sale now asks you to prove, on a tight timeline, that everything you know about the business is also true on paper. That requires two overlapping teams: the people who run the company day to day and the people who have taken companies through a sale before. When those two groups fail to work together, buyers notice.
Your internal team
Start with your own people. They are the ones who will have to answer questions about the business. The exact structure depends on your company, but buyers will expect to see credible leaders responsible for strategy, financial control, technology, operations, and revenue generation.
Your chief executive officer has to keep the story consistent throughout every conversation. Your chief financial officer needs command of actual performance, forecasts, budgets, and the assumptions behind them, not just the headline numbers. Your technology, operations, and sales leaders need to connect their areas back to the business plan because a buyer’s diligence team will ask them to.
Above management sits your board, and it is tested just as hard. A board is not an administrative formality in this process; it's an operating asset. Effective boards combine accountability, relevant experience, outside perspective, and disciplined decision-making. Oversized boards can lead to friction and slow execution. A weak chair, irregular meetings, late papers, unmanaged conflicts, and a failure to track actions can turn a demanding transaction into a governance crisis just when you need the opposite. A deal-ready board understands its duties, challenges management constructively, and makes informed decisions quickly.
Your external team
Your internal and external teams need to work together, not in separate lanes. Your corporate finance advisor shapes the process, positioning the business, assessing bidders, and testing whether a buyer’s funding is real. Your accountants stand behind those numbers, handling financial diligence and pricing mechanics. Your tax advisors determine how the consideration should be structured so you keep what you expect to keep. Legal counsel coordinates the workstreams, documents, disclosure, approvals, and closing, because almost every workstream eventually becomes a clause in a legal contract. None of these advisors does their job well in isolation.
That coordination only works if you bring people in early enough for their views to still matter. Lenders may require debt repayment, security releases, or break costs that change your net proceeds. Regulators may determine whether signing and completion can happen on the same day or months apart. Insurers will test the quality of the buyer’s diligence and the diligence disclosure process before they price a policy. Lawyers may find transfer restrictions, missing IP assignments, defective commercial contracts, or third-party consents that take weeks to obtain. With the right advisors, these issues can be managed even if discovered shortly before signing, but identifying them early gives you more time and better options.
Keep the circle small
Once the team is assembled, resist the instinct to bring more people in as the process gathers pace. A small deal team usually serves you better than a large one. Decisions are faster, each person has clear ownership of a workstream, and fewer people in the loop means less chance of a leak. Confidentiality matters most before employees, smaller shareholders, customers, or suppliers are told anything is happening, and a leak at that stage can do more damage than a difficult term in the sale and purchase agreement (SPA).
Keep the deal team no larger than necessary, and assign clear responsibility for the data room, diligence responses, financial information, approvals, disclosure, and board reporting. Use the people you’ve brought in. You’re the one person on the team who can’t be replaced, so fiercely protect your time. Don’t become the project’s administrator or do work someone else on the team was hired to do.
Knowing your buyer type and why it matters
Private equity and strategic buyers have different priorities, both in what they buy and how they negotiate.
Buyer type isn't just a label. It tells you what the buyer is actually trying to achieve by buying your company, and the two main types want very different things. Private equity buys a route to future returns. It’s looking for a business that will be worth more when it resells its stake. A strategic buyer buys integration, capability, customers, intellectual property, or market access. It wants what your business does, not what it can be sold for later. Once you know which of these two is in play, you can predict most of what follows: what the buyer values, the risks it will accept, and the future it imagines for you and your management team.
Strategic buyer
A strategic buyer operates from a different premise from a private equity buyer. A private equity buyer’s primary objective is a financial return realized at a future exit. A strategic buyer usually operates in the same or an adjacent market to your company and seeks synergies, customers, talent, intellectual property, products, or entry into new markets to serve its existing business. Identifying the buyer’s motivation gives you useful negotiating information. It typically signals which parts of your business the buyer values most and can inform both the price it is willing to pay and its plans for the business after closing.
PREPARATION
“Non-binding” describes the document. It rarely describes the negotiating position it creates.
Full exit, partial sale, or SPV financing?
You’ve worked out whether you want a full exit or some liquidity, and what kind of buyer you’re dealing with. Now put those decisions together.
Your exit structure and your likely buyer type aren’t two separate decisions. They interact more than the headline options suggest. A full exit pairs naturally with a strategic buyer looking for complete control. A partial sale pairs naturally with private equity, which usually wants you to stay and reinvest. SPV financing sits apart from both, because it isn’t really a sale at all. The traditional exit narrative presents ownership as binary: hold or sell. But your real range of options is broader than that, and structural choice is one of your core strategic decisions, not an afterthought once a buyer appears.
A full exit
- This is where that pairing is clearest: A strategic buyer wanting complete control naturally produces a clean, complete handover of ownership. But the pairing is not automatic. If part of the price is an earn-out or shares in the buyer, the economic separation isn’t actually complete, even where the buyer has taken full legal control, and you remain exposed to post-completion performance or the value of another company entirely.
A majority sale
- This approach aligns most clearly with private equity, because reinvesting part of your proceeds and remaining in management fits a private equity buyer’s usual thesis almost exactly. Assess the immediate sale and the continuing investment separately, because they behave differently—one gives you certainty today; the other depends on what happens next. The mechanics of that continuing investment, including sweet equity, rollover terms, and governance rights, are covered in the buyer-type chapter (see “Knowing your buyer type and why it matters”). The point to take from here is that this route can preserve upside, but it doesn’t give you the same clean break as a full exit.
A minority sale
- Selling a minority stake, whether to a strategic investor or a financial one, can provide personal liquidity while preserving your ownership and control, but it also means that you and the incoming investor must govern the company together going forward. Board composition, consent matters, information rights, future funding, dilution, transfers, drag and tag rights, and exit expectations all become central to daily life, not just to the transaction documents. A minority sale isn’t simply a smaller version of a full exit. You are choosing a partner you may be working with for years. Keeping a majority of the shares does not necessarily give you the final say on every important decision, as a minority shareholder will typically expect veto rights over material decisions.
SPV financing
- This sits apart from the exit routes above, for the reason already noted (see “Should you sell at all?”). You don’t sell your shares at all, so it isn’t paired with a buyer type in the same way. It can release liquidity while preserving your ownership and influence, but it may still trigger rights of first refusal, board or shareholder approvals, and questions about voting control, and it must remain consistent with the company’s future fundraising and the goals of your existing investors.
Once you know which of these routes fits your goals, the next decision is how you run the process to get there. An auction can test several buyers and structures under a seller-led timeline, which works well once you have a clear view of your preferred buyer type and exit structure. A bilateral approach may begin with one buyer’s preferred solution and give you less market evidence on value and terms, which is a real cost if you haven’t already settled your own preferred structure. Treat an inbound offer as information, not as a reason to skip the strategic choice itself. Compare cash, timing, retained ownership, governance, liability, obligations, regulatory feasibility, and future restrictions before selecting the route, since the offer that arrives first is rarely the one that fits best.
PREPARATION
For founders, selling a business is both a commercial decision and a personal one. The headline price is only part of the picture.
Abdullah Mutawi
Partner
Understanding the offer: term sheet, LOI, and NBO
“Non-binding” describes the document. It rarely describes the negotiating position it creates.
A term sheet, letter of intent (LOI), or non-binding offer (NBO) will usually contain only one or two legally binding provisions, most often confidentiality and exclusivity. But the rest still carries moral force and creates an anchoring risk: Once you have agreed on the headline commercial terms, the buyer will expect you to stand by them, and they become the starting point for the detailed negotiations.
The anchoring risk
The first real offer you receive can test your resolve early in the process. Although the commercial terms of the offer will likely be non-binding, once agreed, they will become the reference point against which the long-form documents are drafted and negotiated. The buyer will expect you to stand by them, so reopening them once the long-form agreements are underway is far harder than agreeing on them correctly the first time.
An auction process helps you resist that anchoring by comparing several offers rather than reacting to one. It also gives you the opportunity to propose your own initial terms for bidders to respond to. You may ask bidders to address specified points in their offers, and later rounds may require a fully funded bid, a markup of the seller’s draft SPA, and proposed equity terms where you or management will remain invested. This lets you compare more than price. It reveals each bidder’s actual position on liability, conditions, management, governance, and the work still required before signing. These are the parts of the offer that matter as much as the headline number but rarely get the same attention early on.
Comparing offers properly
Break every offer into its economic components before you compare headline numbers. The pricing mechanism, debt and cash treatment, working-capital assumptions, earn-out, rollover equity, escrow, holdback, and other adjustments all affect what you actually receive and when you receive it. Seek tax advice early, particularly if an earn-out or rollover equity is proposed, as the tax treatment can affect both your net proceeds and how the offer should be structured. Two bids quoting the same enterprise value can produce very different outcomes in practice. One might deliver most of that value in cash at completion, while another defers a third of it into an earn-out you may never fully collect. Any share consideration also requires its own valuation and due diligence on the buyer.
The quality of an offer isn’t only about what you receive. It’s also about what liability you’re exposed to afterward. The proposed warranty package, indemnities, liability caps, disclosure standard, W&I insurance, and treatment of known risks can change the real value of the offer substantially. A clean-exit proposal isn’t the same as a bid that leaves you standing behind broad warranties or indemnities, even if the price looks identical on paper. The same logic applies to conditions. A buyer with multiple conditions precedent may offer a compelling price without offering equivalent deal certainty, and a price you never actually receive is no price at all.
How you compare offers depends on how you’re running the process. In a seller-led auction, you may propose the opening documents yourself and require comparable submissions, which keeps the anchoring in your control. In a bilateral approach, the buyer is more likely to present its preferred terms first. The risk, as noted at the start of this chapter, is allowing those terms to become the basis of the deal before you have properly assessed them. Either way, the discipline is the same—build a structured comparison framework covering price, tax treatment, deal certainty, conditions, information access, exclusivity, management arrangements, risk allocation, and timing, and use it to test every offer before you sign anything. Do that, and the first real offer becomes one data point among several rather than the framework the rest of the deal gets built around.
Have legal counsel review the offer before the commercial positions harden, not after, because your leverage to change a term sheet’s assumptions is highest before you sign it and falls away quickly once you have.
The impact of regulatory and third-party approvals on your deal
Regulatory and third-party approvals can set the pace of the transaction. Identify them too late, and the timeline is no longer yours to control.
A strong price means little if the deal can’t actually close. In M&A transactions, execution risk can sit outside your control entirely. Regulators, local authorities, lenders, shareholders, and commercial counterparties may determine when, how, or whether ownership can change, regardless of what you and the buyer have agreed on directly. That makes approvals more than a closing checklist for you. They shape the transaction structure, the period during which M&A execution risk remains live, and whether the timeline you present to buyers is credible.
Third-party approvals shape the timeline
One clear indication of how often third-party approvals end up driving the M&A timeline is how common it is for signing and closing to be split rather than happening simultaneously. The gap between them is typically the period in which the buyer and seller obtain third-party approvals needed before ownership can transfer. Depending on the sector in which your company operates, there may be no escaping the need to notify, or obtain the consent of, a government or trade authority before ownership can transfer, whatever buyer you choose and however the acquisition is structured. This has become common across most jurisdictions, not a feature unique to this region, and the sectors typically affected include defense, telecommunications, energy, utilities, critical and emerging technology, financial services, and healthcare.
In the MENA region, licensing is usually the first factor that a founder will consider when thinking about third-party consents. Companies operating in the region commonly require trade licenses for their activities, and a transaction may require a license transfer or update before it can close. Although this may appear procedural, it will likely be time-consuming and should be factored into your transaction timeline.
Foreign ownership rules are another factor worth checking early, and they vary considerably from one country in the region to the next, and even between different activities within the same country. Some jurisdictions have moved toward allowing full foreign ownership across most sectors, while others retain local ownership or governance requirements for specific activities considered sensitive or strategic.
Rather than assuming either position, ask your lawyers at the outset whether any such restriction applies to your business and its specific activities. The answer can determine whether a buyer is able to acquire the proposed interest directly or needs to use an alternative structure or obtain additional approval. It is worth factoring this into how you assess a buyer’s proposal from the start, rather than working through it after price and structure have already been set.
Merger control is the dependency most likely to surprise you, precisely because the regional regime is still relatively new. Pre-closing competition filings in the MENA region can be extensive, and parts of the regional merger-control landscape remain unsettled in ways that a mature, long-established regime would not be. Specific tests, thresholds, procedures, and timing can change, and they require verification for the relevant transaction and jurisdiction before you publish a timeline or rely on an assumed clearance period. Don’t assume that clearance is routine or immediate just because the deal itself looks straightforward; a transaction that raises no substantive competition concern can still take months to clear simply because the process is unfamiliar to the regulator reviewing it.
Contractual change-of-control, notification, approval, and termination provisions can sit quietly in customer, supplier, lease, agency, distribution, and financing documents, ready to be triggered by the same transaction the regulators are reviewing. Lenders may require debt repayment and the release of security. Warrant holders may need to exercise and sell before closing. Weigh the timing of these steps carefully against confidentiality, since raising a consent too early can alert people you aren’t ready to tell, while raising it too late risks leaving no time to obtain it.
Administrative requirements
Even once substantive approvals are secured, administrative requirements can still delay signing or completion.
A large cap table increases the coordination burden, even where shareholders agree on the deal—more people to contact, signing authorities to verify, and documents to collect. Individual shareholders may also have unexpected internal approval or execution requirements, such as board resolutions, multiple authorized signatories, wet-ink signatures, or formally authenticated powers of attorney. The requirements will depend on the shareholder, the document, and the relevant jurisdiction, so do not assume electronic signatures or a standard power of attorney will suffice.
Identify these requirements early, alongside any notarization, regulatory submissions, transfer fees, and ultimate beneficial owner filings, and build them into the timetable rather than leaving them until substantive approvals are in hand.
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