MBO and Employee Ownership

Campbell Dallas have experience in acting as lead advisors and offering transactional support to a variety of MBO teams and various employee ownership structures. We will assist in the negotiation of price, advise on the tax implications as well as assist in the fundraising and project management.

Our objective is to achieve the best price and payment terms, reduce the risk and achieve the best deal structure for our clients. This is done by focussing on the key ingredients of the transaction.

Negotiation

We will review the preliminary information made available by the proposed vendor and assess the potential value of the business being disposed of. The objective is to gain an indication of what level of debt the business may be able to support in relation to funding any disposal proceeds. If appropriate we would meet with the vendor, the purpose being to ascertain their price expectation and timetable to completion.

Should our clients wish to proceed, we will assist in the submission of an offer. The offer will be defined in terms of type, either a share deal or a trade and asset purchase. The offer will also define the consideration, how and when that consideration will be paid, what the deal is dependent upon and the expected timetable to completion.

Structure

At an early stage of the process, Campbell Dallas will give advice on the most appropriate tax structure for the acquisition of the business by the MBO team/employees. This will consist of examining expected tax consequences of each structure being proposed (i.e. tax payable on disposal of shares, tax paid on extraction of cash, tax rates chargeable on profits), examining different types of share ownership and whether or not Trust ownership is appropriate.

The objective is to establish a structure that is both tax efficient but also offering the appropriate protection to the shareholder and the new business.

Fundraising

Campbell Dallas will assist in the preparation of projections and a business plan that may be required by a funder to fund the transaction. In addition Campbell Dallas will make introductions and approach funders and discuss the proposed transaction with them on the client’s behalf in order to obtain the required funding. This will include review and negotiation of the funders terms of lending to ensure that an appropriate repayment and covenant structure is put in place.

Expert Advice

Campbell Dallas’ aim is to ensure that our clients always receive best advice. This includes making introductions to appropriate experts where necessary and appropriate. This can include solicitors to carry out all the legal aspects or Employee Ownership advisors who have experience in Employee Trusts.

Project Management

Campbell Dallas will give advice during the legal process. We will advise on the preparation of the sale and purchase agreement, ensuring that the ‘legals’ encompass all the appropriate warranties and disclosures. Further, where appropriate, Campbell Dallas will advise on the preparation of Shareholder Agreements and Trust documentation. Campbell Dallas’ aim is to try and minimise the ‘stress’ of the proposed transaction.

Our Sucess

In 2010 the Corporate Finance Team were named Deal Making Team of the Year at the annual Deals:Dealmakers Awards ceremony. In winning the award, the judges recognised the team’s unique approach to each transaction and as mentioned earlier, the team’s ability to ‘think outside the box’ and bring creative solutions to perceived problems.

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