Changing the Guard?

Are you an owner looking to step away from your business, or a manager seeking to take a more direct involvement? The retirement or exit of a founder/shareholder does not always necessitate a sale to a trade buyer – the answer could in fact be much closer to home. 

A Management Buy-Out (“MBO”) allows the transfer of ownership from existing shareholders to one or more of the current management team, who wish to step up to the plate, take on more responsibility for the direction and success of the business, and also have the opportunity to benefit from the fruits of their labour. 

This should be the friendliest of friendly deals! However, without careful management it could lead to relationships turning sour, which can be devastating for everyone. 

We can help you – whether you are an owner or a manager – devise and structure an agreement that is fair for all parties, having regard to value, and affordability in particular.

Castle Corporate Finance - A Management Buy-Out (“MBO”)

Review

Whether you are a shareholder looking to exit and not interested in selling to trade, or a management team looking to take over the reins and take the business on its next journey, we can work with you to assess the viability of an MBO to help you achieve those goals.

Negotiate

Striking the right deal on an MBO can be much simpler than negotiating with a third party, so long as the parties know each other well, and have high levels of respect. However, it is still important that the key terms of the deal are fair and commercial; we can help negotiate a deal structure that is objective, equitable and affordable.

Fundraise

We can run a fundraising process (alongside the buyout of the business) to enable the MBO team to pay the sellers on completion. Depending on the business plan, funding may come from equity or debt, or a combination of the two – we will source a funding solution that does not weigh like a millstone around the necks of the management team, yet allows a reasonable day one payment to be made to the sellers.

See more here

Manage

We are experts in project managing complex transactions with multiple parties, working with the funders and your incumbent accountants and lawyers, or introducing you to new teams of experts if required. We look to keep everything on track, so that both sellers and management can keep their eyes on running the business.

Complete

An MBO is often a catalyst for big change in a business, with fresh blood and fresh ideas. It is also the end of an era for the selling shareholders, so there can be mixed emotions! We understand this, and will help keep things calm when emotions might run high, all the way to the end.

Putting you in the picture

The Castle Corporate Finance Team

A new dawn for Castle Corporate Finance

As part of our exciting three-year growth plan, Castle Corporate Finance has spent the past six months undergoing a period of transformation, seeking to improve…
What is NOT a qualifying trade?
A company can be assumed to undertake a qualifying trade, unless it is involved in a non-qualifying trade. Examples of non-qualifying trades are:
  • dealing in land, shares or financial instruments;
  • providing finance or insurance;
  • leasing or receiving royalties or licence fees;
  • legal or accountancy services;
  • certain property-based trades such as property development, farming, market gardening, hotel management and operating or managing nursing homes or residential care homes;
  • the generation or export of electricity or the generation of heat or any other form of energy; producing gas or fuel.
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