Treat an unsolicited buyer letter as a lead to screen, not as proof that the sender is qualified, that the business has a stated value, or that you have received a binding offer. Preserve the original letter, verify the sender and the reason for contacting you, and ask what type of buyer or adviser is involved. Before sharing nonpublic information, clarify the proposed process, identify the decision makers and funding path, and use a confidentiality arrangement reviewed for your situation. Compare the request with your own exit goals, set a stopping condition, and involve qualified legal, tax, and financial professionals before signing an agreement or disclosing sensitive records.
Start by classifying the letter
An unexpected letter can be a targeted approach, a broad marketing campaign, an intermediary seeking a mandate, or an attempt to start a conversation without a defined transaction. The wording alone does not tell you which one it is. First record the date received, sender, return address, email domain, telephone number, named entity, and every claim about the proposed acquisition. Keep the envelope, attachment, and original electronic file so later conversations can be checked against the first message.
Do not read phrases such as “interested in acquiring your company” or a suggested price as a valuation conclusion. A credible acquisition process normally develops through information review, negotiation, diligence, and definitive documentation. An SEC-filed letter of intent illustrates the difference: it identifies proposed parties and material terms, states whether obligations are binding, and makes the contemplated transaction subject to further agreements and conditions [3]. A marketing letter is not automatically an offer, letter of intent, or commitment.
Verify who is behind the approach
Ask the sender to identify the legal entity, principals or investment team responsible for the approach, office address, website, role in the process, and whether the sender is the prospective buyer, an intermediary, or a representative of another party. Ask for a short description of the buyer’s acquisition criteria, relevant operating experience, intended transaction structure, and the person authorized to approve next steps. You are not trying to demand confidential information from the other side. You are testing whether the story is specific enough to justify a controlled follow-up.
Check the public record that is appropriate for the entity and jurisdiction. Compare the name in the letter with the name on the website, corporate registration, professional profile, and any disclosed portfolio or transaction history. Treat a polished website, logo, or claimed affiliation as an item to verify, not as proof. If the sender refuses basic identity questions, uses inconsistent domains, pressures you to move to a personal channel, or asks for sensitive records before explaining the process, pause or stop.
Ask questions that reveal buyer fit
A useful first response asks for facts that can be answered without disclosing your own confidential information. Ask why your company fits the stated criteria, what size and type of businesses the buyer normally considers, whether the buyer has an investment horizon or operating plan, and what would cause the buyer to discontinue a review. Ask who will receive information, whether outside advisers or financing sources will see it, and whether the buyer expects exclusivity, a management role, seller financing, or a transition period.
Also ask how the buyer expects to fund a transaction. The answer may be preliminary, and that is acceptable at an early stage, but it should identify whether funding is expected from cash, lenders, investors, or another source. Do not treat an assertion that “funds are available” as verification. A later diligence process may require evidence of financing or approval from the people who control it. Keep questions neutral and written so the answers can be compared with later requests.
Protect information before sharing it
Begin with the least sensitive information that can answer whether a conversation is worthwhile. That may be a high-level description of services, geography, customer type, broad size range, and your general timing. Do not send customer lists, employee details, passwords, tax returns, bank statements, detailed margins, proprietary processes, contracts, or personally identifying information merely because a letter requests them. Separate information that is public from information that could harm the business if circulated.
Before providing nonpublic material, ask for a confidentiality agreement that identifies the permitted purpose, recipients, use limits, required safeguards, return or deletion expectations, and handling of legally compelled disclosure. The exact effect of a confidentiality agreement depends on its wording and governing law, so qualified counsel should review it for your situation. In a filed acquisition letter of intent, confidentiality obligations covered the existence and terms of the proposed transaction and information shared in diligence, with limited disclosures to advisers and financing sources [3]. That example shows why confidentiality is a process question, not a promise to accept a template unchanged.
Separate screening from valuation
A letter may contain a number, range, or formula designed to attract attention. Record it as the sender’s preliminary indication and ask what assumptions support it. Does the number refer to equity value, enterprise value, cash at closing, an earnout, assumed debt, or consideration that depends on future events? What financial period and normalization adjustments are assumed? What conditions could change it? Until those points are defined and tested, the figure cannot be compared fairly with another proposal or with an independent valuation.
SBA guidance advises buyers to review contracts, leases, cash flow, inventory, permits, zoning, and other aspects of the business, and it lists several possible valuation methods rather than one universal formula [1]. That supports a disciplined seller response: use the letter to decide whether to gather better information and explore fit, not to announce a sale price to employees, customers, or competitors. A valuation exercise should be scoped to your circumstances by an appropriately qualified professional.
Set a controlled next step
If the sender passes basic screening, propose a short introductory call with a written agenda. Decide in advance who from your side may attend, what topics are in scope, what will not be discussed, and what follow-up would justify another meeting. Ask the sender to confirm the attendees and their roles. Keep a dated log of questions, answers, documents requested, documents shared, and unresolved inconsistencies. A single owner or adviser should control the disclosure record so that an informal conversation does not become accidental authorization.
Use explicit stopping conditions. Stop if the sender will not identify the buyer, changes material facts without explanation, asks for payment to access a supposed buyer list, seeks sensitive data before confidentiality terms, demands a quick signature, or will not explain who makes decisions. Also stop if the opportunity conflicts with your goals, creates an unacceptable customer or employee risk, or requires commitments you have not reviewed. You can decline courteously without proving that the approach is fraudulent.
Know when professional review is needed
An interested conversation can quickly become a transaction process. Before signing a confidentiality agreement with unusual restrictions, an exclusivity clause, a letter of intent, an indication of interest, a term sheet, or any document that affects rights or timing, obtain advice from qualified counsel in the relevant jurisdiction. A tax professional can assess possible tax consequences, while an accounting or valuation professional can help reconcile financial information and assumptions. None of these reviews makes the buyer legitimate by itself, so identity and funding checks remain separate tasks.
SBA specifically points owners toward professional help during an acquisition process and identifies documents such as letters of intent, confidentiality agreements, contracts, leases, financial statements, tax returns, sale agreements, and purchase-price adjustments [1]. The exact professionals and sequence depend on the transaction. Avoid relying on a generic checklist as individual legal, tax, or financial advice.
Use a simple decision record
After the initial review, write a short decision record with four fields: what the sender claims, what you verified, what remains unknown, and your next action. Add a permission field stating who approved each disclosure and for what purpose. This record makes it easier to notice when a conversation has moved from a general inquiry to a request for diligence, exclusivity, or a proposed agreement. It also gives advisers a clear starting point instead of forcing them to reconstruct a long email chain.
For an owner-operated workflow, software can organize the letter, questions, source checks, permissions, and stopping conditions, but a person should approve every external reply and disclosure. Acquivo is a software platform that delivers the entire sell-side M&A process, valuation, marketing materials, buyer matching, and deal management, on one platform for business owners, M&A attorneys, and boutique investment banks. Acquivo gives business owners the entire sell-side process an investment bank would run, as software, with no success fee. The software is user-operated: it does not represent you, negotiate for you, provide legal or tax advice, or approve a buyer on your behalf.
Key Points
- Treat an unsolicited letter as a lead to screen, not as a binding offer or reliable valuation.
- Verify the sender’s legal identity, role, acquisition criteria, decision makers, and funding path before sharing sensitive information.
- Start with high-level, nonconfidential information and use a confidentiality agreement reviewed for your situation before deeper diligence.
- Ask what a quoted price means, which assumptions support it, and which conditions could change it.
- Use a human-controlled log of source checks, permissions, disclosures, unresolved issues, and stopping conditions.
Sources and references
Source retrieval dates record research access, not article publication. Read our editorial and date policy.
- [1] Buy an existing business or franchise · Accessed
- [3] Non-Binding Letter of Intent · Accessed
Choose your next step
Acquivo is user-operated software. Owners and their professionals remain responsible for decisions, communications, and professional review.
Educational information, not individual legal, tax, or investment advice. Consult qualified professionals for your circumstances. Acquivo provides software, not representation or negotiation on your behalf.