Selling a business is a process, not an event, and the owners who get the best outcomes are the ones who understand the path before they start down it. Here’s how a typical sale unfolds in Alberta, and where the value is won or lost at each stage.
1. Preparation (months to years before)
The strongest sales are built long before a buyer appears. Preparation means getting the company’s records clean, contracts current, IP properly owned, corporate minute book up to date, and reducing the business’s dependence on you personally. This is also when tax structuring happens, with your accountant, to position for the lifetime capital-gains exemption and the most efficient deal structure.
2. Going to market and the LOI
Once the business is ready, you, often with an advisor or broker, find and qualify buyers. A serious buyer signs a non-disclosure agreement, reviews high-level information, and submits a letter of intent (LOI): a mostly non-binding outline of price and key terms. The LOI matters more than it looks, it sets the frame for everything that follows, so the terms you accept here shape the whole negotiation.
3. Due diligence
After the LOI, the buyer’s team examines the business in detail, financials, contracts, IP, employment, litigation, and tax. This is where unprepared sellers lose value: every red flag a buyer finds becomes leverage to cut the price or add conditions. A seller who cleaned house in advance turns diligence into a strength instead of a liability.
4. The definitive agreement
The deal is documented in a purchase agreement, asset or share, with the reps, warranties, indemnities, escrows, and conditions that allocate risk between you and the buyer. This is the most heavily negotiated document of the sale, and where experienced counsel protects you from terms that quietly shift risk back onto you long after closing.
5. Closing and beyond
At closing, conditions are satisfied, regulatory and third-party consents obtained, funds flow, and ownership transfers. But the deal rarely ends there: earn-outs, non-competes, transition services, and indemnity obligations can bind you for years. Understanding exactly what you’ve agreed to, before you sign, is the difference between a clean exit and a long tail of obligations.
Each stage runs under Alberta law, the Business Corporations Act and Securities Act, plus federal rules like the Competition Act where they apply. Knowing the path is how you stay in control of it.