Management buy-outs [MBOs] have become commonplace in recent years, reflecting the enterprise culture that is growing internationally and the availability of funding from both private equity investors and financial institutions.
A management buy-in often competes with other acquirers in the search and targeting of suitable businesses. Here a management team acquires a business with the support of investors. Usually the team will be led by a manager with significant experience at managing director level.
A BIMBO is a hybrid of the above, where existing managers are joined by a new ‘buy-in’ manager or managers.
Embarking on an MBO demands a closer look at the industry-specific issues, which can make or break a transaction.
Choosing the best adviser can make a substantial difference to the success of the negotiations and the structuring of the transaction.
Vendors recognise that they only sell their business once and likelihood of the best possible deal is significantly enhanced by using experienced advisers with a strong industry background.
When choosing an adviser, (whether buying or selling), the following guide should be considered:
- A track record of successful MBO/MBI transactions in the industry
- A network of potential purchasers for the business should the MBO fail to deliver or an alternative exit method chosen.
- Take the opportunity to obtain suitable references from the client for whom the adviser has acted in the industry.
- Industry knowledge
- Reputation of the firm and it’s management including professional qualifications
Whether you are a vendor, Senior Manager seeking an MBO or a credible MBI candidate contact us to discuss your needs.