Legal: The Due Diligence Area With the Nastiest Surprises

Legal due diligence is where a sale process can genuinely stall, not because of anything wrong with the business, but because of details nobody thought to check.

It covers the obvious: your certificate of incorporation, shareholder agreements, statutory registers, meeting minutes. But the real volume of work sits somewhere less expected: every client Master Service Agreement (MSA) and Service Level Agreement (SLA), plus vendor and distributor agreements, read closely for notice periods, exclusivity terms, auto-renewals, and change of control clauses.

That last one caught us out early in our own process. A change of control clause can mean a contract requires the client's consent before it transfers to a new owner. Discover that three weeks before completion, across a dozen key contracts, and you have a genuine problem. Discover it a year in advance, and it's a Tuesday afternoon's work.

This is the clearest example in the whole process of why size and difficulty aren't the same thing.

Auditing every contract you hold sounds like a large task, and in volume, it is, but it isn't a difficult one. It just needs doing early, methodically, and before a buyer's solicitor does it for you and finds the gap first.

If this has you wondering how ready your own business is, the free readiness assessment will show you where to look first, in about three minutes.