Management Buy-Outs and Buy-Ins
A management buy-out involves the purchase of a company or business from its existing owner by a management team or an individual working in the business. It has the benefit of ensuring continuity of personnel, and makes the change in ownership relatively smooth. A management buy-in is much the same, but with management from outside the entity buying in to the business. This can be perceived as a more risky transaction as both ownership and management are changing.
Opportunities for management to purchase are not always easy to spot. That’s where we come in. Circumstances may include; a larger group divesting certain operations, companies selling off divisions due to financial difficulties, small/family business owners wishing to realise their investment, and where there are a lack of succession options within a family business.
Due to the high level of complexity and risk involved in such a transaction, it is essential that an experienced and qualified adviser is appointed at an early stage to project manage the process. The adviser's role includes negotiations with the vendor, financing institutions and other advisers, ensuring that the whole deal is managed in a structured manner.
We are able to assist with:
- Advising on the feasibility of the proposed transaction
- Valuation of the business
- Identifying buy-in candidates (if appropriate)
- Formulating an offer to the owners
- Negotiating with the owners
- Fund raising
- Business planning & financial modelling
- Advising on the deal structure
- Managing the legal and due diligence process
- Overall project management