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We respect your privacy and want news to be relevant. To either, click here or update your preferences by emailing us at info@ts-p.co.uk. Your personal data shall be treated in accordance with our & .

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  • Overview

    A management buy-out (MBO) is a transaction where the owner of a company sells some or all of the shares to members of the existing management team. Often the management team will set up a new company as the acquisition vehicle (Newco).

    A management buy-in (MBI) is similar in structure, but involves an external management team coming in to supplement or replace the existing team.

    Both are popular options within private and owner managed businesses, especially where new skills are needed to drive the business forward, or where the existing owner wishes to retire.

    Funding for an MBO or MBI is often formed of the management team’s own funds, private equity or bank lending, or a combination thereof.

    It is also fairly common for the seller to retain an interest in the company in the form of debt which is repaid over time. This is often referred to as vendor financing and, in some transactions, all of the MBO is vendor financed. In these circumstances a seller will typically require additional security.

    MBIs are more likely to require funding from private equity or bank lending.

    MBOs offer a quicker alternative to a trade sale, as the management’s familiarity with the business requires less time to be spent on due diligence. MBIs usually require more time to conduct the due diligence process, but offer incoming new skills to promote the future success of the business.

    Each MBO and MBI is different. With our tailored approach, clear understanding of the business landscape and practical support and advice, we can help ensure that the deal is completed as quickly and efficiently as possible.

    Our corporate and commercial team offers you expert advice based on proven experience and extensive knowledge of MBOs and MBIs in many industry sectors. We can also call on combined expertise from our other practice areas including commercial property, employment and intellectual property.

    We can assist with all aspects of the legal process and guide you through the sale or purchase, whether you are part of the MBO or MBI management team or the seller. 

    Our services often will include dealing with:

    • Structuring and co-ordinating the management buy-out
    • Heads of Agreement
    • Non Disclosure Agreements
    • Due Diligence
    • Share Purchase Agreement
    • Formation of Newco
    • Articles of Association
    • Subscription/investor Agreement or Shareholders Agreement
    • Security documents, inter-creditor deeds and cross guarantees
    • Loan Notes
    • Board Minutes and Shareholder Resolutions
    • Directors Service Agreements.

     

     

  • Related Client Stories

    Thomson Snell & Passmore advises on MBO of Kent Fresh Produce Distributor

    Thomson Snell & Passmore has advised on the management buy out of a Kent based fresh produce storage and distributor.

    Thomson Snell & Passmore advises on MBO

    Thomson Snell & Passmore has advised on the management buy out of a Kent based fresh produce supplier.

    Thomson Snell & Passmore advise on employee buy-in and Shareholders’ Agreement

    We recently advised our client, a specialist commercial insurance broker, in relation to an Employee buy-in and Shareholders’ Agreement, with the aim of incentivising a key member of staff and governing the relationship going forwards.

    Thomson Snell & Passmore co-ordinates strategic share buy back

    We acted for a specialist chocolate manufacturer on a share buy back leading to the exit of one of the key shareholders and directors.

    Thomson Snell & Passmore advised on the Management Buy-Out transaction of Michael Parkes

    Thomson Snell & Passmore advised on the Management Buy-Out transaction of Michael Parkes Surveyors Limited, a firm of Chartered Surveyors, Property & Planning Consultants based in Medway and London.

    Thomson Snell & Passmore advises £25 million family run tyre-dealer business

    We advised Kent based family-run tyre dealer and autocentre company, Watling Tyre Service Limited, in connection with a share purchase and restructuring transaction. The purchase involved the buy out of the minority shareholder.

    Thomson Snell & Passmore advise on management buyout for office furniture company

    We acted for an office furniture company in a management buy-out including cross jurisdictional negotiation.

    Thomson Snell & Passmore advise UK's leading & longest established knife sharpening and food processing equipment supplier

    We acted for and advised the UK’s leading & longest established knife sharpening and food processing equipment supplier in relation to the purchase of shares and group restructure transaction.

  • Latest Updates

    Thomson Snell & Passmore advises on SE10 MBO

    Law firm Thomson Snell & Passmore, has advised on the corporate restructure and Management Buy-Out (MBO) of SE10, and its related group companies.

    Historic law firm advises on MBO (Management buyout)

    South East law firm Thomson Snell & Passmore has advised on the management buyout (MBO) of a London-based theatrical goods retailer.

    TSP Connect Seminar: Acquisition, Funding for Growth and Exit Strategies - Bridgewood Manor, Chatham, Kent

    Thomson Snell & Passmore hosted a seminar for over 35 attendees discussing acquisitions, growth and exit strategies for businesses and business owners. 

    Handing over the reins: Tips for planning succession

    For the founder of a business, putting in place a succession strategy and exiting the business can be a difficult process. Where some of the founder’s family are also involved in the business, that process can be further complicated by competing interests and differing visions. 

    Exit on the horizon? 5 reasons to sell to a management team

    Working with family businesses and SMEs, we know that succession planning is a common headache for owners.

    £25 million independent tyre dealer and autocentre completes acquisition

    Leading South East law firm Thomson Snell & Passmore have advised Kent based family-run tyre dealer and autocentre company, Watling Tyre Service Limited, this week in connection with a share purchase and restructuring transaction for an undisclosed sum.

    Thomson Snell & Passmore completes sale of shares in industrial tyre business

    Thomson Snell & Passmore’s corporate team has advised new clients in connection with the sale of their family business for an undisclosed sum to a US buyer.

  • Insights

Newsletter sign up

I would like to receive newsletters, event invitations and publications from Thomson Snell & Passmore by email on the following topics (tick all those that apply) and consent for my data to be processed for this purpose.

We respect your privacy and want news to be relevant. To either, click here or update your preferences by emailing us at info@ts-p.co.uk. Your personal data shall be treated in accordance with our & .

Get In Touch

By submitting an enquiry through 'get in touch' your data will only be used to contact you regarding your enquiry. If you would like to receive newsletters from Thomson Snell & Passmore please use the separate form below.

Their commerciality is important - they know where we want to get to.

Client

They act effectively, on time and deliver results in all the areas that we ask them to work on our behalf. 

Client

They act effectively, on time and deliver results in all the areas that we ask them to work on our behalf. 

Client

Thank you for confirmation that completion has taken place, I am delighted with the outcome and for all the hard work that you and your team have put in to get the deal done on time.

Client

I do feel that both Ben and Julie have been excellent throughout this. The money they have, they were only ever going to get a strong law firm and I feel they would have got the impression throughout this that I too have obtained the services of people that know what they were doing and couldn't be overpowered or pushed around. I'm convinced that ultimately the strong showing from the two of you is what has actually got an agreement out of court rather than them pitying me so I wanted to express my genuine appreciation to you both.

Client
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