Selling the family business in S-E Asia - pitfalls and a roadmap

GOOD investment opportunities are extremely sought after and privately-owned businesses make increasingly attractive targets. For family businesses in South-east Asia, the option of "cashing out" or (partially) selling the business has become an intriguing option worthwhile exploring.

The reasons differ from family to family: It may start with the founder's desire to realise that long-harboured dream; or a realisation that the next generation(s) may have quite a distinct vision on how to spend their lives or they may simply show little inclination to run the business in future. There may be family members with differing opinions on how to run the business, especially in contemplation of a generational transfer or overwhelming competition and a sense of "it's simply not worth it anymore". More often than not, it is a combination of the reasons above.

While the reasons for bringing in external investors or selling the family business are manifold, the required steps seem relatively straight forward: agree on a value for the company and then find a suitable buyer. Granted there is more to be said on each, but we would like to focus on the "blind spots" that, if overlooked or not tackled in a timely manner, may result in unsatisfactory experiences when selling the family business.