Selling shares versus selling assets

You sell the company itself. Contracts, employees, licences and history transfer with it because the legal entity does not change.

Sellers usually prefer this: it is a cleaner exit and, in the UK, disposals of shares may qualify for reliefs that an asset sale would not. It also means the buyer inherits the company's past, so expect firmer warranties.

The buyer picks up specific assets — goodwill, equipment, customer relationships — and leaves the company behind. Employees generally transfer under TUPE, but some contracts need consent to novate.

Buyers sometimes prefer this because it leaves unknown liabilities with the old entity. Sellers can end up taxed twice: once in the company on the gain, once again extracting the proceeds.

Structure is negotiable and it has a real cash value, so it belongs in the conversation early rather than at heads of terms.

Take advice from your accountant before agreeing to either. The right answer depends on your shareholding, your history and what you plan to do next.