Selling an ongoing contract to another company

[Wing Commander]

Hi all

I own a domestic and commercial cleaning company, and I want to focus 100% on the domestic. I have one particular commercial contract which is a nice one to try and sell on to another commercial company. It's got good monthly profits, and its easily packaged up for a company to drop in.

We have done the contract for 12 months now, and the customer is very happy. There was an initial 12 month contract, and we are now in a rolling 2 month notice period, with no indication that the contract will be terminated any time soon.

I have two companies interested, who are established commercial companies and more than capable of handling it.

My questions are:

Factoring in the 2 month rolling notice we are now in with this contract, what would be the best way to value this contract for sale?

The thinking is that a new competant company would continue the service exactly as it has been, but I am worried if there are any issues around not telling the client before a sale. In my mind, this is a bit like when a bank you use is bought out by another bank. Service is maintained, and you continue making use of their service. Am I oversimplifying this and opening myself up to any issues?

And finally, a real result for me would be if I convince the client to sign a new 12 month contract, then sell the contract on. Value would be much higher, but is this likely to be seen as shady by the client ie sign the new contract without being told that its likely to be sold on.

Thoughts on the above, but most important bit for me is to work out value of the contract for sale, with a 2 month rolling notice.

Forgot to add - we have staff, equipment, materials and everything in place to make this completely "turnkey" for a buyer.

Thanks

[TownIdiot]

With two month's rolling notice I can't see it's got much value at all, unless there are onerous terms relating to how the client can invoke the notice clause.

Someone should be prepared to offer you a share of income for as long as the contract remains in place however.

[extraT]

Keep the contract and outsource it, on a per month base? Even if you outsource for 90% of the value per month, that’s 10% for doing nowt.