Selling your business can involve disclosing to potential buyers confidential information that would normally remain private.
To ensure this information is still protected during the sale, you can use a non-disclosure agreement (NDA) which prevents anyone who has seen your confidential information from revealing it to another party with the threat of legal action as a consequence.
What is an NDA?
An NDA is a contract that you and anyone who will be viewing your commercial information as part of the selling process will sign.
It will give you the peace of mind that your business and the private information within the business is protected from your competitors and the public.
The NDA can protect many different items of information such as business plans, financial information and employee details as well as other confidential details.
Why should you consider using an NDA when selling your business?
There are many benefits when it comes to ensuring your business is protected while you are negotiating a sale.
Potential buyers could work in a similar industry to your business which means that, should they not go ahead with the sale, they could otherwise use the information they have seen for competitive purposes.
With an NDA in place, if anyone did use the information they saw for their own benefit or the benefit of another business, you could take legal action against them.
Selling your business can be a long and complex process so the benefits of having peace of mind that your information is protected will be worth it in the long term.
Ultimately NDAs are a way of ensuring that any potential buyer is aware of the risks they would be taking if they were to use your information for their own benefit.
Latest posts by Maung Aye (see all)
- Top mistakes made when conducting a merger or acquisition - February 6, 2023
- Shares within a company and how they differ - January 31, 2023
- NDAs during the process of selling your business – why are they important? - January 30, 2023