MBO / Management Buyout
A management buyout means selling your business to individuals from your management team. It can be a great option if they have the ability and the drive to successfully run the business.
At Entrepreneurs Hub, we offer comprehensive support for Management Buyouts (MBOs), guiding you and your management team through every step of the process. From initial strategy development and business assessment to financial structuring and funding options, we help ensure a smooth transition to new ownership. Our team conducts thorough business valuations, oversees due diligence, and facilitates negotiations to secure the best terms for all parties involved.
After the MBO is completed, we can provide ongoing support, assisting with post-transaction integration, strategy, and growth to ensure the long-term success of the business. With our expertise, we help business owners confidently navigate the complexities of an MBO and achieve a successful outcome.
Our approach is as unique as you are and our team tailors each aspect of our tried and tested process to ensure it aligns with your goals. A dedicated team of experts work with you to deliver everything you need to succeed:
Dedicated advice and consultation throughout the process
Financial analysis, valuation support, modelling and forecasting with an experienced, CFO level expert
Project Management support which includes supporting the collation of required information to complete the MBO process
Key Benefits
FAQs – Management Buy Out
What is an MBO?
An MBO (Management Buy-Out) refers to the acquisition of a company by its existing manager or management team. There are other related terms as well, such as MBI (Management Buy-In) – When an external management team acquires and takes over the business or BIMBO (Buy-In Management Buy-Out) which is a combination of both, where existing managers team up with external managers to acquire the company.
What are the disadvantages of an MBO?
An MBO can be an effective exit strategy, but it also comes with disadvantages and risks. Read more…
How does an MBO work?
A Management Buy-Out (MBO) involves a company’s existing management team purchasing the business they already help run. The process typically begins when the team identifies an opportunity to take ownership, believing they can drive the business forward independently. They negotiate terms with the current owners and arrange for a valuation of the company. To finance the buy-out, the team usually raises funds through a combination of personal investment, bank loans, private equity, or seller financing. Before the deal is finalised, due diligence is carried out to assess the company’s financial health and risks. Once funding is secured and legal agreements are in place, ownership is transferred to the management team, who then take full control of operations with a focus on growth and debt repayment.
How much can I sell my business for?
Determining your business’s value is more than just calculating a number it’s complex with key factors, that said the basic equation is actually quite simple. Read more…
How long does it take to sell my business?
The timeline varies depending on the complexity of the deal and how ready the business is for sale. On average, the process takes around twelve months – sometimes less, sometimes more.
While preparing your business for sale, Entrepreneurs Hub conducts in-depth research to identify potential acquirers. You’ll have the opportunity to review and approve this list before we make any approaches. Once the business is fully prepared – often the most time-consuming step, we begin marketing it. Typically, you’ll start seeing initial interest within a few months, with follow-up meetings happening shortly after.
As these meetings progress – coordinated and facilitated by Entrepreneurs Hub, you’ll begin receiving initial offers. At this stage, we’ll help you assess the strategic fit between your business and potential buyers. When you decide to move forward with an offer, an exclusivity period begins, during which the acquirer conducts Due Diligence (DD).
The DD phase typically lasts two to three months, depending on the complexity of your business. Once complete, the sale is finalised, and you’ve successfully sold your company.