July 2016 - Making Management Buy Outs Work

Avocet has launched its MBO Help Kit involving both finance  & people search options.

In today's marketplace MBOs are becoming more popular for SME Owner Exits, but often there may be finance raising issues, &/or the need to recruit a new member of the  Management Team to fiull the vacuum being left by the Owner's retirement.

Avocet has good contacts amongst the iinovative funders who have sprung up to fill the vacuum left by banks post the Great Recession.

In particular :

-  Invoice Discounting (ID) advance of 90% from a more normal 80%, for the critical first 12 months of new ownership, when cash flow is critical

-  Confidential Credit Control supplied by the ID funder

-  A Term Loan without Personal Guarantee, secured against the Sales Ledger, which could include Work In Progress

-  Commercial Mortgages large advance & low interest rate

-  Re-leasing of aged vehicles & plant

With regard to finidng that talent to complete a winning Management Team , Avocet has combined with two small specialist                                                       Executive Search teams who charge by time spent on the assignment  rather than a % of starting salary, so favoured by                                                                    the typical "mud against the wall" agency.

Early experience shows that this new approach is significantly cheaper to the client, & yields better candidates

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