Imagine your banker reaches out to one of their clients:
“Hey, do want to buy a strata portfolio but I can’t give you any information as it’s not my profession…”
Getting your bank or accountant to “shop around” your business to their existing client base can seem like a good approach, as they already have a relationship with you and with their clients. However, this convenience comes with specific risks that could leave you, and the other party, with a bad deal — or worse, a legal headache.
The risks of letting your accountant or banker act as both matchmaker and dealmaker
1. The “Price Ceiling” risk
By only showing your business to their own clients, your advisor is limiting the pool of buyers.
- Lack of competition: In a truly open market, multiple bidders drive the price up. If your accountant only calls three people they know, you might get a “fair” price, but you’ll never know if a global buyer would have paid a 30% premium.
- Preferred treatment: Your advisor might be tempted to “steer” the business to a buyer who is a long-term, high-fee client of theirs, rather than the buyer who is best for you.
2. Conflicting loyalties
This is the “Two Masters” problem. If your bank or accountant represents both you (the seller) and the person buying your business:
- Whose side are they on? During tough negotiations over warranties or price drops, you need an advocate. If the advisor wants to keep the buyer happy for future business, they may pressure you to concede on points that hurt you financially.
- Fee incentives: They might be earning a success fee from you and a financing fee (if it’s a bank) or ongoing tax fees (if it’s an accountant) from the buyer. This creates a massive incentive for them to “just get the deal done” rather than getting it done right.
3. Confidentiality leaks
Your accountant or banker knows your “dirty laundry”, including your tax secrets, debt levels, and real profit margins.
- Information slippage: There is a risk that sensitive information is shared with the potential buyer (their other client) during a casual lunch or “introductory” meeting before you’ve even signed a solid Non-Disclosure Agreement (NDA).
- Reputational damage: If the “shop around” fails, word can spread through the local industry or your specific niche that your business is “on the block,” which can spook your employees and suppliers.
4. Professional negligence and liability
If the deal goes south after the sale, you could find yourself in a legal battle.
- The “Buyer’s Remorse” pivot: If the buyer (also a client of the firm) feels they overpaid, they might sue the accountant for professional negligence. This puts your advisor in a position where they have to defend themselves, often by blaming the information you provided.
- Independence issues: Regulatory bodies (like the TPB for accountants or ASIC for banks) have strict rules about independence. If the advisor didn’t follow “arm’s length” protocols, the entire sale process could be legally challenged.
Thinking about selling a strata portfolio in Australia?
If you are thinking about selling a strata portfolio, speak with a specialist who understands how these deals work.
At Strata Business Brokers, we help owners bring their business to market through a structured, confidential, and professionally managed sale process — not informal introductions that can compromise price, confidentiality, or deal quality.
We focus specifically on strata management business sales across Australia, helping owners reach qualified buyers, protect value, and manage the transaction from start to finish.
If you want a discreet and properly managed process, contact Strata Business Brokers to discuss your options. Call us on 0480 857 183 or send us a message here.
