Commercial Law
Purchase of Business
Buying a business is a significant investment. We provide expert legal guidance to help you navigate contracts, due diligence, and regulatory requirements with confidence.
Purchasing a business is one of the most complex commercial transactions you can undertake. Beyond agreeing on a price, you must review and negotiate a detailed Contract of Sale of Business, conduct thorough due diligence across financial, legal, and operational matters, manage lease assignments, address employee entitlements, and ensure all regulatory approvals are in place before settlement. A poorly conducted purchase can result in inheriting undisclosed liabilities, unenforceable contracts, or regulatory non-compliance. At Legal Wave, our commercial lawyers protect your interests at every stage — ensuring you understand exactly what you are buying and that the transaction is structured to minimise risk.
How We Can Help
Contract Review and Advice
We review the Contract of Sale of Business and Section 52 Vendor's Statement in detail, identifying hidden risks, unclear terms, and unfair clauses. We explain your rights and obligations in plain language and advise on any amendments needed before you sign.
Negotiation of Contract Terms
We assist with negotiating key contract terms — including the purchase price, payment structure, conditions precedent, warranties, indemnities, and restraint of trade clauses. Our goal is to ensure the contract protects your interests and clearly allocates risk between the parties.
Due Diligence
We guide you through a comprehensive due diligence process, reviewing financial statements, contracts, leases, intellectual property, employee arrangements, licences, and regulatory compliance. We identify any issues that could affect the value or viability of the business and advise on how to address them before proceeding.
Lease Assignment
If the business operates from leased premises, the lease must be assigned to you as part of the purchase. We review the lease terms, manage the assignment process, obtain landlord consent, and ensure the assignment is completed correctly at settlement.
Regulatory Approvals and Licences
Many businesses require specific licences or regulatory approvals to operate. We identify all required approvals, advise on the transfer process, and ensure all necessary licences are in place before settlement so you can commence trading immediately.
Settlement and Post-Purchase Support
We coordinate the preparation and execution of all legal documents at settlement, ensuring all assets and liabilities are correctly transferred. After settlement, we remain available to advise on transitional arrangements, contractual obligations, and any disputes that may arise.
5 Things Every Purchaser Should Know
Understand What You Are Buying
A business purchase can be structured as an asset sale (buying the individual assets) or a share sale (buying the shares in the company). In an asset sale, you generally do not inherit the company's historical liabilities. In a share sale, you take on all of the company's liabilities — including any that were not disclosed. We advise on the implications of each structure and ensure the contract reflects the agreed terms accurately.
Due Diligence Is Not Optional
Thorough due diligence is the most important step in any business purchase. It involves reviewing financial statements, tax returns, contracts, leases, employee arrangements, intellectual property, licences, and regulatory compliance. Skipping or rushing due diligence can result in inheriting undisclosed liabilities or discovering problems after settlement when it is too late to walk away.
Check the Lease Before You Commit
If the business operates from leased premises, the lease is one of the most important documents to review. Key issues include the remaining lease term, rent review mechanisms, permitted use, assignment conditions, and any personal guarantees required by the landlord. A short remaining lease term or unfavourable assignment conditions can significantly affect the value and viability of the business.
Employee Entitlements Must Be Addressed
In an asset sale, the contract must clearly address the treatment of employee entitlements — including accrued annual leave, long service leave, and any redundancy obligations. If the buyer takes on the seller's employees, the contract should specify which entitlements are being assumed and which are being paid out by the seller. We ensure these obligations are clearly defined to avoid disputes after settlement.
Warranties and Indemnities Protect You After Settlement
The warranties and indemnities in the Contract of Sale of Business are your primary protection against undisclosed liabilities and misrepresentations by the seller. We negotiate strong warranty provisions with appropriate time limits and financial caps, and ensure the contract includes effective indemnities for any losses arising from breaches of warranty.
Frequently Asked Questions
Ready to Purchase a Business in Victoria?
Our commercial lawyers provide expert, practical guidance throughout your business purchase. Contact us today for an initial consultation.