Business struggling to find a buyer?
Do you have a client, where the owner wants to sell, but you're struggling to find a suitable buyer? Could an Employee Ownership Trust be a suitable exit plan?
Key things company needs:
- Senior team capable and willing to run the business
- To meet the “participator rule”. Essentially at least 2.5 employees for every shareholder
Founder must also be aware:
- They’ll be paid out over a longer time than a trade sale
- May not get paid in full if business fails soon after transfer
- Sales price may be lower than trade sale
On the plus side:
- Minimal intrusive due diligence
- Minimal risk of buyer pulling out
- Timeline to suit the business/owner
- Business brand/independence remains intact
- Staff more likely to retain jobs
Plus the founder:
- Can have a lot of say in their role post sale
- Can retain minority shareholding (if they wish)
- Zero CGT on sales proceeds (if criteria met)
Get in touch to discuss selling these businesses to an EOT.