Offer economics · Before you sell
How sellers should compare business purchase offers
Published · Reviewed by The Diligence Standard Team · Updated
Put every offer into the same economic bridge. Separate certain cash, delayed payment, contingent value, rollover equity, deductions, conditions and post-close obligations. The highest headline price may rank lower after risk and timing.
A realistic transaction story
A logistics-company owner received offers of $4.2 million and $3.9 million. The higher offer included a $700,000 earn-out and a long financing condition. The lower offer provided more cash at closing with a narrower indemnity package.
What the evidence changed
The headline ranking changed after the seller compared probability, timing and continuing exposure.
What to check
- Write down the exact claim and who supplied it.
- Ask what was independently tested, by whom and under what scope.
- Normalize every offer into cash at closing, expected later proceeds, contingent value and retained obligations.
- Translate any unresolved gap into cash, price, terms, timing or a decision not to proceed.