Information Memorandum template UK

What an Information Memorandum is

An Information Memorandum, often shortened to IM, describes a business offered for sale. It brings the commercial story, operations, people and confirmed financial information into one document. It is not a sales agreement or a guarantee of future performance. Its purpose is to help a prospective buyer decide whether to investigate further and what questions to ask. For a small UK business, a clear, proportionate document is more useful than a long document full of claims that cannot be supported.

The named IM comes after the blind teaser. The teaser gives enough non-identifying information to attract suitable enquiries. The IM explains the named business once confidentiality and access are dealt with. You should not treat sending an IM as proof that a buyer is suitable or funded. That remains a separate decision.

What goes in it

Start with what the business makes or does, who its customers are and how it earns revenue. Explain when it started, how orders arrive, the types of products or services and any seasonal pattern. Describe premises, equipment, systems and material supplier relationships. Use records to support the description. If a point is not known, mark it for checking rather than drafting around it.

The people section should explain headcount, important roles and the work carried out by the owners. Buyers need to understand what changes when you leave. Give a realistic handover outline without promising work you have not agreed to do. Customer concentration, repeat revenue and contracts are different facts. A customer buying again does not automatically mean there is a recurring contract.

Financial information and adjustments

Show comparable annual figures with clear year ends. Turnover, gross profit, gross margin and adjusted EBITDA should come from the accounts and the profit bridge you have checked. State what each adjustment represents and keep the evidence available. Owner pay can be adjusted to replacement cost only where the inputs are complete. No adjustment should be added merely because it makes the business look stronger.

Current trading needs its own period and a comparison with the same period in the prior year. Six months of turnover is not six months of profit. Do not turn growth ideas into forecasts. The seller-only indicative valuation range does not belong in the IM. A buyer-facing document can state your asking price or that offers are invited, but it must not disclose the private valuation calculation.

When to use it and what comes next

Use the IM when a buyer has passed the confidentiality steps you require and you have decided to share it. In the paid buyer room, access also depends on the seller’s approval. Each buyer copy carries a name and issue date watermark. This creates a record of the copy issued, not a substitute for checking access rights or observing the NDA.

The next stage is questions and due diligence. The IM should lead readers to supporting records, not replace those records. A data room index helps organise them. Keep a dated copy of what each buyer received and record material corrections. If facts change during the sale, update the relevant documents and make sure the buyer is not relying on an older version.

Build free, pay when you are ready

The Sale Pack starts with your own answers and accounts. You check the figures, explain the business and decide what is included in the proposed sale. You can see the indicative valuation and marketing documents in a protected preview without paying. Legal documents are named in the preview contents, rather than shown as free legal drafts. Pay £495 only when you are happy, then download and use the documents. No VAT is charged. There is no broker commission.

The price is for one business and one deal. It does not include finding buyers, negotiation, portal listing fees or professional advice. Your solicitor and accountant remain separate from the product. The service is self-serve. Support is limited to payment, login, upload faults and data requests. No one checks the commercial merits of your proposed deal for you.

Keep control of the information

A public advert or blind teaser should not name your business or give away identifying details. The named Information Memorandum can contain more information, but it belongs behind the confidentiality process you choose. Website-sourced logos, colours and photographs are restricted to that named document. Do not put them in a blind teaser. A buyer room is a paid feature and the seller controls access after email verification and a signed NDA.

Before sharing a pack, read every document and check it against your records. A tidy layout is not evidence that a statement is correct. Explain gaps rather than filling them with guesses. Keep seller-only valuation information out of documents sent to buyers. Ask your own advisers about tax, legal effect, employee matters and any regulated part of the transaction. The product does not rank buyers or tell you which offer to accept.

Common questions