Completing an MBO

A management buy out, or MBO, is the purchase of a business from its owner by the existing management team.

Why is an MBO attractive to management teams?

An MBO provides management teams with the opportunity to make significant capital gains from what can be relatively modest initial investments.

What are the key factors in a successful MBO?
Effective management team with the desire for ownership and ability to execute future strategy.
A commercially viable business with a track record of profitability and cash generation.
Willing seller with realistic price expectations.
Robust business plan which demonstrates the business can service the funding required.
Future exit opportunity to enable investors and management realise their investment.

Spotting MBO opportunities

Retirement of owners (of privately owned company)
Non core subsidiaries sold to realise cash to invest in core activities
Financially distressed groups needing to raise funds
Businesses in insolvency sold as a going concern
Institutional owners (e.g. private equity funds) wanting to realise their investment

How can we help?

Taking proper advice will significantly increase your changes of ‘completing’ an MBO successfully. We will:

To learn more, and see if we might be able to help you please contact Nigel Barratt on 0161 477 2474.

Hurst Accountants