Can someone fact check me on normal workflow for business sales process?

searcher profile

September 05, 2023

by a searcher from Dartmouth College - Tuck School of Business at Dartmouth in Bozeman, MT, USA

I (potential buyer) was provided an NDA/LOI today by the seller. The LOI was written from a potential buyer perspective - essentially ghost written for me and included a valuation price. I have not received CIM data or the requisite info to even confirm the value at this point. The LOI is nonbinding but it certainly felt like the well worn path had been skipped, i.e. NDA -> CIM -> LOI -> DD -> Purchase Agreement. Am I off here? Is it more common for smaller transactions to bundle/skip steps early on to vet buyer?

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commentor profile
Reply by an intermediary
from Boise State University in 800 W Main St, Boise, ID 83702, USA
Is the seller represented by a Broker? If not, then the seller likely has no knowledge of the "normal" process. This puts all the responsibility on you which is a tough place to be since the seller doesn't know or trust you yet. If there is a broker, call him/her and ask about the process. The broker may also be inexperienced!
commentor profile
Reply by an intermediary
from The University of Chicago in Rockford, MI, USA
This is highly unusual. I would let them know you’re willing to sign the nda (after thorough review ), but are not comfortable entering into an LOI or offering a valuation until you know significantly more about the business.
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