Business Sale VS. Company Sale: What is the difference?

As a potential business purchaser, buying a company and buying a business may sound similar, however, there are aspects that make the two options quite different.

Business Sale

When compared to a company sale, a business sale is generally more straightforward. By entering into a Sale of Business Agreement with a potential purchaser, the business is transferred to new ownership. 

In a successful business sale, the following occurs once the purchaser has agreed to buy the business:

  • A deposit is paid by the purchaser
  • The landlord of the premise(s) must approve the purchaser as the new tenant
  • Settlement will occur when all parties are happy and have come to an agreement
  • At this point, the remainder of the purchase price will be paid by the purchaser and the sale is finalised, meaning that the business name and assets are transferred into the purchaser’s name

Company Sale

A major difference between a business sale and a company sale are shares

When a company is sold, the shares in that company are sold, alongside any business currently operated by said company.

For example, ‘Green Pty Ltd’ own’s the business ‘Red Coffee’. Therefore, if ‘Green Pty Ltd’ is sold, the purchaser not only owns the company but the business ‘Red Coffee’ as well.

When buying a company, as with any type of legal business transaction, we advise you seek the assistance of a professional to aid in the buying process. 

However, things to keep in mind consist of, and are not limited to:

  • What percentage shareholding is being sold?
  • Are there any other shareholders remaining in the company?
  • Does the company have any debts or liabilities present? As these may transfer to the new purchaser

The transfer of company ownership can be more complicated than business ownership. It is vital that the Seller complies with all requirements of ASIC when selling the company. Other documents such as the Deed of Share Sale and Release are used and there are many aspects that need to be considered.

GMO highly recommends the employment of professional business and legal services when dealing with either of the above scenarios. If you are considering purchasing a business OR a company, contact the office on (08) 9481 4422, Graham O’Hehir and the team have a great deal of experience and knowledge that they are always happy to share.

Buying or selling a business in Western Australia with GMO Business Brokers

With over 3500 successful sales to our name, GMO business brokers has grown to become Western Australia’s preferred business broker. When looking into buying a business in Perth or elsewhere in our state you will be assigned an experienced business broker to guide you through the process of buying a business or selling a business in WA. GMO’s business brokers are each specialized in their own business sector which makes that you always have someone on your side who is highly knowledgeable about the industry you are looking to buy into. We have a broad range of businesses for sale in Perth and beyond, please contact us to answer any questions you might have.


  • The disclosers are willing to disclose such information to the recipient subject to their acceptance of the following conditions:
    1. The recipient shall treat all information received from the discloser as confidential and shall ensure that all such information remains confidential and shall not use any such information in any way other than for the specific purpose aforesaid. The recipient acknowledges that all conditions subsequent in this disclosure apply to the recipient and any associates of the recipient be they partners, co‐directors, trustees, holders of shares or officersin entity(s) the recipient has interest in.
    2. The obligations of paragraph 1 shall not extend to any such information which is in the public domain, or which hereafter becomes part of the public domain otherwise than as a result of any unauthorised activity or omission of the recipient, or which is already in the possession of the recipient and was not derived from the disclosers.
    3. The recipient shall return all such information received other than that which is submitted orally at the termination of such negotiations entered into as a result of this agreement.
    4. The obligations set forth in paragraph 1, 2 and 3 shall terminate 12 months from the date of this agreement or upon the disclosers and the recipients entering into an agreement whichever event occursfirst.
    5. The recipient shall obtain no rights of any kind to such information other than for the specific purpose stated in this agreement.
    6. The receiving party will not utilise any material made available to improve, construct or change another business, in such a way as to allow that business to compete with the business being discussed.
    7. The recipient understands that the information has been compiled by GMO from details provided by the Vendor. Prospective purchasers should be aware that it is not intended that any projections or this information be treated as a representation, warranty or promise by GMO or its representatives, as to the correctness of the information, or that all relevant information is contained in the information provided.
    8. The recipient acknowledges that they will not act on information provided without first seeking independent financial and legal advice.
    9. The recipient hereby agrees to declare any beneficial interest in any business that could currently be interpreted as being in competition with the subject business.
    10. The recipient agrees to return all documents supplied within 50 days of receipt (and any copies) should they decide not to proceed. The recipient further agrees to destroy any electronic information supplied by the Seller or GMO and to instruct their professional advisors to also destroy any information passed on by the Seller, the recipient or from GMO.
    11. The recipient acknowledges they are precluded from physically visiting the premises of the business or talking to any client, supplier or employee of the business without the permission of the discloser.
    The recipient/s hereby accepts the above conditions as binding on them in respect of the information referred to.
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