Partial Exits, MBOs & VAMBOs
A partial exit gives you the best of both worlds and effectively ‘two bites of the cherry’.
It gives the vendor:
- The majority of the cash off the table
- A financial partner to develop the business
- More control to existing and new management
- Continued involvement at either an executive or non-executive level
- A platform for a second exit in three to five years
We have a proven track record of partial exits with many institutional partners.
Partial exits may take the form of an MBO (management buyout) financed either by debt from a bank or a financial institution. We are experts in advising exiting shareholders and management teams seeking to acquire a controlling stake in a company. (see Fundraising below).
A VAMBO is a vendor assisted management buyout akin to a partial exit. The vendor will manage the sale of the business to management, agree support in the form of retained equity and an earn-out but will not necessarily have any future involvement in the running of the company.
Will I get maximum price?
In today’s market there is a shortage of good deals for Institutions. Our experience shows that a financial buyer will pay the maximum price for a niche business which has potential to be a market leader and/or is market disruptive.
Will I lose control?
You will have taken the majority of the value off the table and therefore the environment will inevitably change. However, an Institution is not there to run a business day-to-day, this will be left to the management.
Is the process time consuming and complex?
The process is complex and involves detailed due diligence on many levels. However, we will prepare your business well in advance to ensure that the transaction is completed with the maximum of efficiency.