{"id":1352,"date":"2022-01-09T22:39:08","date_gmt":"2022-01-09T22:39:08","guid":{"rendered":"https:\/\/uk.legalvision.com.au\/?p=1352"},"modified":"2025-11-25T22:34:37","modified_gmt":"2025-11-25T22:34:37","slug":"sell-part-of-business","status":"publish","type":"post","link":"https:\/\/legalvision.co.uk\/business-sale-purchase\/sell-part-of-business\/","title":{"rendered":"Can I Sell Part of My UK Business?"},"content":{"rendered":"\n<p><span style=\"font-weight: 400\">Selling part of your business can be a good idea in certain situations. It can help raise money,&nbsp; re-strategise and refocus your business or cut costs. There are different ways to sell part of your business, depending on your goal and what you want to achieve. This article outlines scenarios in which you might sell part of your business. It will also explain the sale process and the key legal considerations you should be aware of when undertaking such transactions.<\/span><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span style=\"font-weight: 400\">When Should I Consider Selling Part of My Business?<\/span><\/h2>\n\n\n\n<p><span style=\"font-weight: 400\">Selling your business in portions can be a good strategic decision. Unlike putting your whole business up for sale, selling only a part can help you achieve a longer-term business strategy.&nbsp;<\/span><\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span style=\"font-weight: 400\">Re-Focusing Your Business<\/span><\/h3>\n\n\n\n<p><span style=\"font-weight: 400\">After operating your business for a while, you may find that your business has one particularly profitable area. You may wish to focus your resources and review your business strategy in a company&#8217;s core area.&nbsp;<\/span><\/p>\n\n\n\n<p><span style=\"font-weight: 400\">You can do this by selling part of your business. This might be a good idea because you can focus your time and effort on that area to outdo your competitors.<\/span><\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span style=\"font-weight: 400\">Raising Capital<\/span><\/h3>\n\n\n\n<p><span style=\"font-weight: 400\">You may find that you need to <a href=\"https:\/\/legalvision.co.uk\/startups\/im-startup-founder-raise-capital-for-business\/\">raise capital for your business<\/a>. This can be for various reasons, such as for paying debts or for expanding. Selling part of your business can raise capital without generating more debt. With the capital you raise, you can invest in expanding your business or putting more resources into a profitable area of your business.&nbsp;<\/span><\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span style=\"font-weight: 400\">Reducing the Cost of Doing Business<\/span><\/h3>\n\n\n\n<p><span style=\"font-weight: 400\">By offloading unprofitable assets, you can streamline your business and reduce overall costs. This can help improve your bottom line. This may also be necessary if you have made an acquisition that has turned out to be unprofitable, and you wish to cut your losses.&nbsp;<\/span><\/p>\n\n\n\n<div class=\"box box--warning box--icon\">\n<p><span style=\"font-weight: 400\">At the same time, if you are selling to reduce the cost of business, you should be sure that selling is better than restructuring.&nbsp;<\/span><\/p>\n<\/div>\n\n\n\n<h3 class=\"wp-block-heading\"><span style=\"font-weight: 400\">Selling Parts of Your Business to Maintain Share Value<\/span><\/h3>\n\n\n\n<p><span style=\"font-weight: 400\">If your company is publicly listed and trades on a stock exchange, and you wish to dispose of it, you might want to sell off parts of the company gradually rather than all at once.<\/span> <span style=\"font-weight: 400\">Selling the whole company in one go can reduce shareholder confidence and affect your company&#8217;s share price. Selling in parts over a prolonged period could be a good strategic decision.&nbsp;<\/span><\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Legal Considerations Before Selling<\/h2>\n\n\n\n<p>Before proceeding with any partial sale of your business, several legal considerations must be addressed:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>review existing contracts and agreements to identify any restrictions on asset transfers or change of control provisions;<\/li>\n\n\n\n<li>ensure compliance with directors&#8217; duties under the <em>Companies Act 2006<\/em>, particularly regarding acting in the best interests of the company;<\/li>\n\n\n\n<li>consider whether shareholder approval is required for substantial property transactions;<\/li>\n\n\n\n<li>assess any regulatory requirements specific to your industry; and<\/li>\n\n\n\n<li>review employment law implications if the sale involves a transfer of undertakings.<\/li>\n<\/ul>\n\n\n\n\n<a href=\"#content-next\"\n   class=\"block p-4 mt-10 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The method you use depends on what you are trying to achieve. The two main options are an <a href=\"https:\/\/legalvision.co.uk\/business-sale-purchase\/share-sale-vs-asset-sale\/\">asset sale and a share sale<\/a>.&nbsp;<\/span><\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span style=\"font-weight: 400\">Asset Sales<\/span><\/h3>\n\n\n\n<p><span style=\"font-weight: 400\">If you are looking to sell a particular part of your business, an asset sale can help you achieve that. An asset is something that your business owns. For example, land, equipment, or <a href=\"https:\/\/legalvision.co.uk\/intellectual-property\/types-of-intellectual-property\/\">intellectual property<\/a> are assets. Through an asset sale, you can handpick the assets you want to sell and offer them to potential buyers.&nbsp;<\/span><\/p>\n\n\n\n<p><span style=\"font-weight: 400\">An asset sale can be preferable if:<\/span><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><span style=\"font-weight: 400\">you want to offload a specific part of your business; or<\/span><\/li>\n\n\n\n<li><span style=\"font-weight: 400\">you want to generate capital in exchange for part of your business.<\/span><\/li>\n<\/ul>\n\n\n\n<p><span style=\"font-weight: 400\">An asset sale usually means that you completely lose control over the asset you are selling. As a result, you should seriously consider whether it is the best way of achieving your goal. For example, you may lease your asset to a potential investor instead. It might be better to retain control over the asset if:<\/span><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><span style=\"font-weight: 400\">the asset may become profitable in the long term;&nbsp;<\/span><\/li>\n\n\n\n<li><span style=\"font-weight: 400\">you can get a good price for leasing the asset; or<\/span><\/li>\n\n\n\n<li><span style=\"font-weight: 400\">you do not need to raise capital immediately.<\/span><\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\"><span style=\"font-weight: 400\">Share Sales<\/span><\/h3>\n\n\n\n<p><span style=\"font-weight: 400\">You can also sell a part of your business ownership through a share sale. A share sale is where you offer shares in the company to potential investors. This will dilute your control over the company. Your control will depend on how many shares you decide to sell and whether you give voting rights to the new shareholders.&nbsp;<\/span><\/p>\n\n\n\n<p>A share sale involves selling shares in your company to new investors, making them part-owners of the business. The company retains all its assets and liabilities, but control is shared with the new shareholders.<\/p>\n\n\n\n<p><span style=\"font-weight: 400\">A share sale in this way can be good for retaining control of the business while raising capital. Similarly, instead of offloading your company&#8217;s assets, you can give control over certain parts of your business to new shareholders. This may be preferable for tax purposes, given that you may have to pay capital gains tax on profits that you make from an asset sale.&nbsp;<\/span><\/p>\n\n\n\n<p><span style=\"font-weight: 400\">A share sale, on the whole, may be preferable if:<\/span><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><span style=\"font-weight: 400\">an asset sale may fetch you a lower price;<\/span><\/li>\n\n\n\n<li><span style=\"font-weight: 400\">you want to keep the assets as part of the business while still raising capital;<\/span><\/li>\n\n\n\n<li><span style=\"font-weight: 400\">you would value having new shareholders as part of your business.<\/span><\/li>\n<\/ul>\n\n\n\n<div class=\"box box--icon box--star\">\n<p><span style=\"font-weight: 400\">On the whole, whether you opt for a share sale or an asset sale will depend on the reason for which you are selling a part of your business.&nbsp;<\/span><\/p>\n<\/div>\n\n\n\n<h2 class=\"wp-block-heading\"><span style=\"font-weight: 400\">Which Method Should I Select?<\/span><\/h2>\n\n\n\n<p><span style=\"font-weight: 400\">This depends on your unique business situation. Below, we outline some potential benefits of each method.<\/span><\/p>\n\n\n\n<figure class=\"wp-block-table is-style-stripes\"><table><tbody><tr><td><strong>Benefits of an Asset Sale<\/strong><\/td><td><strong>Benefits of a Share Sale<\/strong><\/td><\/tr><tr><td>\n<p style=\"text-align: center\"><span style=\"font-weight: 400\">Streamlines costs by completely offloading a part of your business.<\/span><\/p>\n<p style=\"text-align: center\"><span style=\"font-weight: 400\">You may get a good price for your company&#8217;s assets.<\/span><\/p>\n<p style=\"text-align: center\"><span style=\"font-weight: 400\">No dilution of your company shares.<\/span><\/p>\n<\/td><td>\n<p style=\"text-align: center\">You retain the assets of your business.<\/p>\n<p style=\"text-align: center\">It is possible to sell your entire ownership of the company.<\/p>\n<p style=\"text-align: center\">New shareholders have control over a part of your business.<\/p>\n<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\">Tax Implications<\/h2>\n\n\n\n<p>Understanding the tax consequences of your chosen method is crucial:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Asset Sales: <\/strong>Capital gains tax may apply to profits from asset sales. The company may also need to account for corporation tax on gains. However, certain reliefs may be available, such as rollover relief if proceeds are reinvested in qualifying assets.<\/li>\n\n\n\n<li><strong>Share Sales: <\/strong>Individual shareholders may be liable for capital gains tax on any gains made from selling shares. Business Asset Disposal Relief (formerly Entrepreneurs&#8217; Relief) may reduce the tax rate on gains, subject to qualifying conditions.<\/li>\n<\/ul>\n\n\n    <div class=\"my-7 lg:my-10 border-y-2 border-gray-100 py-7 lg:py-10 flex flex-col sm:flex-row items-start gap-10\">\n                    <img decoding=\"async\" class=\"w-52 mx-auto my-0! rounded\" src=\"https:\/\/img.legalvision.com.au\/wp-content\/uploads\/sites\/4\/2023\/01\/13013547\/buying-a-business-560x792-1.jpg\" alt=\"Front page of publication\"\n                 loading=\"lazy\" width=\"208\" height=\"298\">\n                <section>\n            <div class=\"text-2xl font-bold\">Buying a Business: Guide to Negotiating Terms<\/div>\n            <div class=\"body-text\">\n                <p>Buying a business? Download this free guide to help you negotiate key terms like price, stock, and employee entitlements.<\/p>\n            <\/div>\n            \n\n<a href=\"https:\/\/go.legalvision.co.uk\/buying-business-guide.html\" class=\" block px-5 py-3.5 max-w-fit bg-orange button__hover transition rounded text-white font-bold text-lg no-underline uppercase leading-tight text-center\" target=\"\" rel=\"\">Download Now<\/a>        <\/section>\n    <\/div>\n\n\n\n\n<h2 class=\"wp-block-heading\"><span style=\"font-weight: 400\">Key Takeaways<\/span><\/h2>\n\n\n\n<p><span style=\"font-weight: 400\">Whether you should sell part of your business depends on your overall business strategy. Sometimes, retaining your business assets is a good idea. This is especially true if you have put hard work into that part of your business, or you think it may be profitable in the longer term. On other occasions, it may be a good idea to cut your losses and sell an unprofitable asset. Additionally, you should consider tax consequences when deciding between the two.<\/span><\/p>\n\n\n\n<p><span style=\"font-weight: 400\">If you need help with selling part of your business, our experienced <\/span><a href=\"https:\/\/legalvision.co.uk\/business-sale-purchase-lawyers-lp\"><span style=\"font-weight: 400\">business sale lawyers<\/span><\/a><span style=\"font-weight: 400\"> can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on <a href=\"tel:+448081968584\" class=\"AVANSERnumber dynamic-number\">0808 196 8584<\/a> or visit our<\/span>\u00a0<a href=\"https:\/\/legalvision.co.uk\/membership\"><span style=\"font-weight: 400\">membership page<\/span><\/a><span style=\"font-weight: 400\">.<\/span><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span style=\"font-weight: 400\">Frequently Asked Questions<\/span><\/h2>\n\n\n\n<div class=\"schema-faq wp-block-yoast-faq-block\"><div class=\"schema-faq-section\" id=\"faq-question-1641767627403\"><strong class=\"schema-faq-question\"><strong>As a new owner, how can I get a business valuation for prospective buyers?<\/strong><\/strong> <p class=\"schema-faq-answer\">You can simply add up your assets and subtract your liabilities to get a rough estimate. However, you may wish to ask a third party or a business broker, who can give you a closer estimate as to what a reasonable sale price might be.<\/p> <\/div> <div class=\"schema-faq-section\" id=\"faq-question-1641767637449\"><strong class=\"schema-faq-question\"><strong>Can I retain my intellectual property when selling parts of my business?<\/strong><\/strong> <p class=\"schema-faq-answer\">Yes. You do not have to sell your intellectual property, but doing so might help you fetch a higher price. It depends on your overall business strategy and how important your intellectual property is.\u00a0<\/p> <\/div> <\/div>\n<div class=\"not-prose m-feedback-prompt\">\n    <!-- Thumbs up\/down bar -->\n    <div class=\"m-feedback-prompt__main\">\n        <div class=\"m-feedback-prompt__title\">Was this article helpful?<\/div>\n        <div>\n            <!--span class=\"m-feedback-prompt__button--text\">Thanks!<\/span-->\n            <button type=\"button\" class=\"m-feedback-prompt__button m-feedback-prompt__button--yes\"\n                    data-analytics-link=\"feedback-prompt:yes\" aria-label=\"Agree\">\n                <i class=\"fa-regular fa-thumbs-up fa-3x\"><\/i>\n            <\/button>\n            <button type=\"button\" class=\"m-feedback-prompt__button m-feedback-prompt__button--no\"\n                    data-analytics-link=\"feedback-prompt:no\" aria-label=\"Disagree\">\n                <i class=\"fa-regular fa-thumbs-down fa-3x\"><\/i>\n            <\/button>\n        <\/div>\n    <\/div>\n\n    <!-- Feedback form -->\n    <div class=\"m-feedback-prompt__form\">\n        <div class=\"m-feedback-prompt__form--thanks \">\n            <div>Thanks!<\/div>\n            <p>\n                We appreciate your feedback \u2013 your submission has been successfully received.            <\/p>\n        <\/div>\n        <form id=\"contact-form\" class=\"m-feedback-prompt__form--form\" action=\"\" method=\"post\">\n            <input type=\"hidden\" id=\"authenticity_token\" name=\"authenticity_token\" value=\"9eb4f72322\" \/><input type=\"hidden\" name=\"_wp_http_referer\" value=\"\/api\/wp\/v2\/posts\/1352\" \/>            <input value=\"https:\/\/legalvision.co.uk\/business-sale-purchase\/sell-part-of-business\/\" type=\"hidden\" name=\"currenturl\"\n                   id=\"currenturl\">\n            <input value=\"Can I Sell Part of My UK Business?\" type=\"hidden\" name=\"currenttitle\"\n                   id=\"currenttitle\">\n            <label>\n                <!-- display on thumbs-up -->\n                <span class=\"m-feedback-prompt__feedback m-feedback-prompt__feedback--yes\">\n                    Can you tell us <span class=\"font-semibold\">why<\/span> you found it helpful?\n                <\/span>\n\n                <!-- display on thumbs-down -->\n                <span class=\"m-feedback-prompt__feedback m-feedback-prompt__feedback--no text-lg\">\n                    How can we better improve this article?\n                <\/span>\n                <textarea name=\"feedbackmessage\" id=\"feedbackmessage\" required><\/textarea>\n            <\/label>\n\n            <div class=\"m-feedback-prompt__form--error\" id=\"form-submit-error\"><\/div>\n            <button id=\"submit-contact-form-button\" type=\"submit\" name=\"commit\" class=\"m-feedback-prompt__form--submit\"\n                    data-analytics-link=\"feedback-prompt:submit\">\n                Submit            <\/button>\n        <\/form>\n    <\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Selling part of your business can be a good idea in certain situations. It can help raise money,&nbsp; re-strategise and refocus your business or cut costs. There are different ways to sell part of your business, depending on your goal and what you want to achieve. This article outlines scenarios in which you might sell<a href=\"https:\/\/legalvision.co.uk\/business-sale-purchase\/sell-part-of-business\/\">Continue reading <span class=\"sr-only\">&#8220;Can I Sell Part of My UK Business?&#8221;<\/span><\/a><\/p>\n","protected":false},"author":13459,"featured_media":532,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_relevanssi_hide_post":"","_relevanssi_hide_content":"","_relevanssi_pin_for_all":"","_relevanssi_pin_keywords":"","_relevanssi_unpin_keywords":"","_relevanssi_related_keywords":"","_relevanssi_related_include_ids":"","_relevanssi_related_exclude_ids":"","_relevanssi_related_no_append":"","_relevanssi_related_not_related":"","_relevanssi_related_posts":"1358,2205,1704,2491,1454,2745","_relevanssi_noindex_reason":"","editor_notices":[],"footnotes":""},"categories":[29],"tags":[20,21,101,102,167,223,257],"class_list":["post-1352","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business-sale-purchase","tag-small-business","tag-medium-business","tag-share-sale","tag-asset-sale","tag-selling-a-business","tag-large-business","tag-raising-capital"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.1.1 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Can I Sell Part of My UK Business? 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