What should you look out for when taking over a business?
Wednesday, July 29, 2026
For many entrepreneurs, acquiring a business is an attractive way to grow faster than through organic growth. You acquire an existing enterprise with customers, employees, revenue, and a proven market position. At the same time, a business acquisition also entails risks. Without proper preparation, you may unexpectedly face hidden obligations, an excessively high purchase price, or a business that turns out to be less future-proof than initially anticipated.
A successful business acquisition therefore does not start with negotiations, but with asking the right questions. What exactly should you look out for? Which risks do you want to rule out in advance? And how do you determine whether a company actually fits your ambitions? In this blog, you will read what to look out for when acquiring a company and which points of attention are important during the acquisition process.
Why is good preparation important when taking over a business?
Good preparation for the taking over a company is important because you limit risks, make better choices, and enter negotiations in a stronger position.
Many entrepreneurs look at the asking price first. However, the true value of a business is determined by many more factors, such as profitability, dependence on the entrepreneur, customer contracts, personnel, and future growth opportunities. Good preparation helps you to:
Create realistic expectations
: You gain a clear picture of the value and potential of the company.
Mapping out financing opportunities
: You know in advance what financing is feasible and what this means for the acquisition.
Identify risks in a timely manner
: You identify potential points of attention and pitfalls before making a decision.
Negotiate better
: You are better prepared at the table for discussions regarding price, terms, and agreements.
The better prepared you are, the smaller the chance of unexpected setbacks during the acquisition process.
Which risks must you investigate during the due diligence investigation?
During the due diligence investigate whether the seller's information is complete and reliable and what risks are associated with the company.
A due diligence, also known as a book audit, usually takes place after the parties have reached an agreement in principle. The audit gives you the opportunity to verify financial, tax, legal, and commercial information. In doing so, you examine, among other things:
Financial administration
: Verify whether revenue, costs, profit, and balance sheet items reconcile with the records and annual accounts.
Legal agreements
: Review contracts with customers, suppliers, landlords, financiers, and employees.
Tax obligations
: Investigate whether tax returns have been filed correctly and whether there are any outstanding tax debts or tax risks.
Commercial dependence
: Check whether a large part of the revenue depends on a few customers, products, or sales markets.
Personnel risks
: Assess employment contracts, absenteeism, pension arrangements, and dependency on key figures.
Operational continuity
: Investigate whether processes, systems, and knowledge are sufficiently documented to continue the business independently.
The results of the investigation may warrant adjustments to the purchase price or conditions. Certain risks can also be mitigated through guarantees, indemnities, or additional agreements in the purchase contract.
How do you finance a business acquisition?
A business acquisition is usually financed with a combination of own resources, external financing, and agreements with the seller.
The appropriate financing structure depends on the purchase price, the company's cash flows, your own financial position, and the risks of the transaction. Banks and investors primarily look at the repayment capacity and the quality of the business plan. Common forms of financing are:
Equity
: A own input demonstrates that you are taking risks yourself and often forms the basis for additional financing.
Bank financing
: A bank loan can finance part of the purchase price when the company has sufficiently stable cash flows.
Seller's loan
: Immediately seller's loan the seller defers part of the purchase price and receives this amount later, often including interest.
Earn-out arrangement
: With the earn-out arrangement part of the purchase price is made dependent on future results after the acquisition.
External investor
: An investor contributes capital and usually receives an equity stake in the company in return.
In practice, multiple funding sources are combined to arrive at a feasible structure.
When arranging financing, leave sufficient room for setbacks and future investments. Maximum financing may seem attractive, but it can make the company financially vulnerable after the acquisition.
How do you determine whether a company is future-proof?
You determine future-proofing by investigating whether the business model, market position, and organization offer sufficient prospects after the acquisition.
Good historical results offer no guarantee for the future. The market can change, customers may leave, and important knowledge may reside with the current owner. Therefore, it is wise to look beyond the annual figures. Pay attention to the following:
Market development
: Assess whether the market is growing, remaining stable, or under pressure due to regulation, technology, or changing customer behavior.
Competitive position
: Research into what distinguishes the company and how easily competitors can copy this.
Owner dependency
: Determine which customer relationships, knowledge, and duties lie personally with the salesperson.
Quality of the organization
: Check whether there is an independent management team, clear processes, and sufficient qualified employees.
Opportunities for growth
: Assess whether opportunities exist for expansion, new products, additional services, or further professionalization.
In addition, create your own business plan and financial forecast. Do not base these solely on the seller's expectations, but on realistic assumptions regarding revenue, margins, personnel, and investments.
How do you assess the financial health of a company?
When acquiring a company, you should pay particular attention to the quality of the profit, future cash flows, and the justification of the asking price from a financial perspective.
Historical figures form an important starting point, but they do not tell the whole story. A company may appear profitable on paper, while the results depend heavily on incidental income, low entrepreneurial remuneration, or deferred investments. Key financial considerations are:
Quality of sales
: Investigate whether the revenue is structural and comes from a broad and stable customer base.
Normalization of profit
: Adjust the figures for one-off costs, private expenses, extraordinary income, and a non-market salary of the entrepreneur.
Development of cash flows
: Assess whether the company generates sufficient funds to pay for investments, interest, and repayments.
Required investments
: Determine which investments are required after the acquisition in personnel, systems, machinery, or premises.
Working capital requirement
: Determine how much money is needed to continue financing daily business operations after the transfer.
A realistic valuation therefore looks not only at the past, but especially at the profit capacity and cash flows that you, as a buyer, can expect in the future.
What is the role of an advisor when acquiring a company?
Acquiring a business involves much more than determining a purchase price. You will have to deal with searching for suitable companies, valuation, negotiations, financing, due diligence, and legal agreements. An advisor ensures that these steps follow logically and safeguards your interests throughout the entire process. An M&A advisor supports you with, among other things:
Determine acquisition strategy
: Together, you map out your objectives and determine which type of business best aligns with your ambitions.
Searching for and approaching companies
: If you have not yet found a suitable company, an advisor assists with drawing up a profile and discreetly approaching potential acquisition candidates.
Valuation and bidding strategy
: You gain insight into a realistic business value and support in preparing a well-substantiated one. bid.
Facilitating negotiations
: The advisor assists with the negotiations regarding the price, terms, and structure of the transaction.
Arrange acquisition financing
: Various financing options are being explored and tailored to your situation.
Coordinate due diligence
: The due diligence is supervised so that financial, tax, and legal risks are brought to light in a timely manner.
Contracts and transfer
: The advisor guides together with our lawyers the legal settlement of the acquisition and ensures a careful process up to the transfer at the notary.
By involving an experienced M&A advisor early in the process, you gain more control over the trajectory, avoid costly surprises, and increase the chance of a successful business acquisition.
Why choose Match Plan?
Acquiring a business is a significant step that requires careful preparation and expert guidance. Match Plan supports entrepreneurs throughout the entire acquisition process, from initial orientation and determining the acquisition strategy to valuation, financing, negotiations, and the final transfer. Your objectives and interests are always at the forefront. What we can do for you:
- We guide you throughout the entire acquisition process, from initial orientation to the final transfer at the notary.
- With over 30 years of experience, we support entrepreneurs with business acquisitions, business valuations, and financing issues.
- We help you determine a realistic business value and guide the negotiations regarding the price and terms.
- We advise on the financing options that best suit your situation and ambitions.
Do you want to acquire a business and be certain that you are not overlooking any important risks? Our M&A specialists guide you through every step of the acquisition process. Contact us without obligation for an introductory meeting.
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