Looking for an exit? We can help you to pick the right one

We know how to prepare and help you get your business into shape for exit.  We work with some excellent Corporate Finance House partners, wealth managers, solicitors and tax advisors and, we can advise on all the various exit routes open to business owners. 

Your business will be set fair for the market, with the rigour of due diligence and the emotional challenge of an exit addressed and, importantly your transaction will be deliverable at the maximum value.  

Each option has its pros and cons and, unlike some companies, we don’t apply a one-size-fits-all solution. Our support is tailored around a business owners’ priorities, not just the size of the company or the sector it operates in. We always discuss these key questions with owners: 

  • How do you see the legacy of the business?  
  • How quickly do you want to take the money out?  
  • How are you going to prepare for exit? 

We can work with you on a number of exit routes, alongside a sale or partial sale, two of your options include setting up an Employee-owned Trust (EoT) or going down the route of a Management Buy Out (MBO). 

Employee-owned Trust (EoT)

An Employee-owned Trust means employees own the business indirectly – with some or all of the shares being held on their behalf. The ownership and governance of the business are separated, but the direction of the business can be influenced in how the Trust is created and employees can be represented on the Trust going forward. An advantage of this exit route is that it is exempt from Capital Gains Tax if the majority of shares transfer over, and a tax-free bonus can be paid to employees each year, if appropriate. It also supports a continuation of the business’s values and ethics going forward. Disadvantages could include a slower payment compared to a straightforward trade sale, and possibly a lower value for the company than could be gained in the open market.  

Management Buy Out (MBO)

We also can support you to explore the Management Buy Out model. Here, the management team set up their own company to buy the shares in the existing business – depending on the structure of the deal agreed, this may or may not, require them to investing their own capital to provide a structured exit for the founder. Proceeds of the sale for the exiting owner are subject to Capital Gains Tax. 

We have had the pleasure of guiding a number of businesses through a sale process using these methods. A recent example involved a company we steered through a successful management buy-out process. Prior to our involvement there has been an unsuccessful attempt to go down the same route. But with our help, and us supporting the structure and business planning process, the process was successful. Representing both the owners and the managers helped us ensure a smooth sale, with the owner staying on for a couple of years to help maintain the company’s legacy and ethics during transition. 

Whatever solution fits, its important the incoming management team are happy and there is a clear plan, so that the owner who is selling can maximise their return. 

Good preparation and as long a timescale as possible will ensure you make the right sale at the right price for your business.

Contact us for support and advice on successfully exiting your business.