We have developed a tried and tested 7 step process to give MBO teams the best possible chance of buying their business on favourable terms. In summary:
Step 1: Assess your business
We will work with you to assess whether your business is a suitable target for an MBO and the value to put on it.
Step 2: Shape the business plan
We will help you develop or improve your business plan so that it includes all the areas that a potential investor would need to consider before financing the business.
Step 3: Form the management team
We will assess the management team and advise you on how to complete the team if necessary. We can also guide you on the level of investment that management should offer as part of the transaction.
Step 4: Arrange the funding
We will recommend the most appropriate private equity, debt and similar funders for you to meet and help you assess the funding offers you receive. We will help you structure funding so that it works for the long-term.
Step 5: Agree the terms
At the same time as negotiating with possible funders, an MBO team also has to agree terms with the vendor. These negotiations will be going on in tandem and can be extremely delicate with the outcome of one obviously directly affecting the outcome of the other. Corbett Keeling is highly experienced in advising management teams on this “chicken-and-egg” situation, agreeing terms with both funders and vendors at the same time.
Step 6: Co-ordinate the process
We will be your project manager on the transaction, liaising with the specialist legal, tax and due diligence advisers involved so as to leave you, the management team, as free as possible to focus on running the business.
Step 7: Completion
Management buy-outs are like riding a horse in the Grand National. Every time you jump one fence, another presents itself. We will lead all parties over the various hurdles to completion, normally in a timetable of a minimum of 3 and a maximum of 12 months.