Management Buy-outs and Buy-ins

Buy-outs

You are a successful management team. You know how to grow your business and manage customers, suppliers and employees to drive profitability. Now you have the chance to become the owners of the business. You have the opportunity to build wealth for yourself, rather than for the shareholders.

This may well be a once in a lifetime opportunity, but beware; the consequences of getting it wrong can be severe. This is why it is critical to get specialist corporate finance advice. The buy-out process can be technically complex, it will certainly be time consuming, and will carry a considerable financial risk for the management team. To minimise the risk it is crucial to get in place a financial structure that supports the business realities.

Buy-ins

The buy-in process is a very different animal. The motivation is almost always the prospect of considerable financial game. The risks are also higher for both the buy-in team and their financial backers. You will almost certainly be industry experts; but will not have the detailed company knowledge of an existing management team.

Careful management of these risks will require the expert input of a corporate finance advisor. We can guide you to the sources of finance prepared to accept the higher risks of buy-in deals, and help you assess the real viability of the deal.

Our approach

We advise buy-out and buy-in teams to approach a deal in much the same way as any other acquisition. We help you make a careful assessment of viability, including the chances of finding financial backers, and give an honest appraisal of your chances of success.

If you decide to go ahead our role will typically include:

• Helping you understand the risks and rewards of the deal;
• Advice and assistance in formulating a bid price, including preparing a post acquisition business plan and financial projection;
• Project managing the deal process, and coordinating the inputs of various advisors;
• Supporting, or if you prefer leading, deal and contract negotiations;
• Modelling deal structures and the various options for financing;
• Arranging finance.