A management buy-out (MBO) occurs when a business owner sells the business to members of the existing management team. A management buy-in (MBI) occurs when a business is sold to an outside management team.
For many business owners, the process is a natural part of their succession plan. A management buy-in (MBI) occurs when a business is sold to an outside management team. Although opportunities for management buy-ins often arise when business owners are dissatisfied with the performance of their current management, they are also an excellent means by which a successful business can add additional capital and management expertise into the mix when a business is financially stressed or requires additional resources to expand.Kennedy Needham specialises in advising teams through the management buy-in/buy-out process.
Successfully completing an MBO or MBI is often more difficult than other transactions since it requires the agreement from a wide range of stakeholders, most of whom have competing interests. Many teams attempting to manage a project in this environment find it to be a difficult experience. In our role as an independent corporate advisor we represent the interests of the team in negotiations with other stakeholders and project manage the process from start to finish.
What we do
Working with our clients, we:
- Target businesses which suit each client's individual preferences and resources.
- Assist clients in securing financial support for the purchase of the business.
- Advise clients on the most appropriate mix of debt and equity in each case.
- Negotiate the deal with the vendors.
- Assist in the development of a business plan for the enterprise.
- Advise clients on the most effective shareholder and governance arrangements.
- Project manage the deal from start to finish. Where it is necessary for lawyers and accountants to be involved we project manage their involvement for you.
Why we are different
- We can assist clients who are looking to secure finance for large or small transactions. We will undertake assignments for clients regardless of the size of the transaction.
- We place great importance in building strong and robust governance and shareholder arrangements at the outset for teams undertaking an MBO or MBI, so that they are free to focus on the fundamental task of growing the business.
- We can assist clients who need help in finding and structuring their management team.
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