Things to Know When Buying a Business: Travel Weekly
Overview
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Critical Topics
Sustainable Travel
By Mark Pestronk
Q: We are considering expanding by acquiring other travel agencies and a tour operator. One target has requested a lot of confidential information about our business, including tax returns and financial details. Is this normal?
A: It's not typical, but it should be when there are deferred payments, especially over several years or with an earnout. The seller wants to know if they'll get paid.
The scope of inquiry includes:
- Your financial statements
- Existing debt
- Pending litigation
- ARC standing
- Seller-of-travel registrations
- Plans for employee, IC, and client retention
- Assumption of contracts
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