LOI to Close - List of Tasks & Advice on Timing

February 23, 2022

by a searcher from Stanford University - Graduate School of Business in West Hollywood, CA 90069, USA

Hi all,

I am about to submit an LOI on a business where the seller is looking to close quickly (ideally by end of march or latest by mid-April).

I want to make sure I'm not missing anything, so I'd love to hear advice on what all I need to complete between LOI to Close in as much detail as possible (or point me to other references).
Also any advice on timing (bare minimum, assuming I have the funds) would be helpful.

Thanks!

Reply by a professional
from North Central College in Chicago, IL, USA

This is a tough one as closing any deal in under 60 days is hard. There is so much between LOI and Close like all of the diligence workstreams, purchase agreements, assignments of items, employment agreements, setting up new payrolls and bank accounts, establishing reporting policies. That is not an inclusive list but then you need to think on 1oo day plans and announcement plans. I am sure you probably have some templates and what not from you current day job. One thing to note it is a big lift doing it on your own versus having several teams in large PE funds.

Reply by a professional
from Dartmouth College in Los Angeles, CA, USA

Generally a good rule to add 30 days to whatever your or seller's expectations are. End of March would be very very optimistic, end of April would be doable depending on how many outside parties are involved (investors and lenders on your end, third party consents or real estate transfer requirements on the seller's end).

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