Individuals involved with the sale of appreciated assets are familiar with the occurrence of a common scenario- a price gap. Very rarely do buyers and sellers come to the negotiating table with the same numbers (asking price vs. offering price). Sometimes it may greatly impede the sale of the asset, creating frustrations for all parties involved.
There is a new tool being used with the sale of appreciated assets called the Structured Sale. In some cases, it can help bridge the price gap between buyer and seller.
The reason is because the buyer's payment obligation is the present value of the on-going installment payments to the seller. The length of payment deferral and the payout duration will directly influence the spread. I have put together an example of how this works, which you may download below.
The Structured Sale is not only just a benefit to a Seller, but a tool that can be used to help facilitate the transaction for all parties- this is much more valuable than just an end product.
For specific questions please contact CrailHuntly.
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