We steered our client through the process of a management buy-out and secured one hundred percent finance from a high street bank.

About

Our client, the owner of successful road and car park marking company Gilvar Lining, wanted to retire and gave his management team the option to purchase the shares. The management team were keen to go ahead with the MBO but were concerned they would have to use personal funds to do so.

Gilvar Lining are a professional road marking company based in Staffordshire. The owner, Mark Davies, had successfully built the company over four decades and was ready to enjoy retirement. Our client initially approached us for guidance on negotiation and to assess the likelihood of raising finance to be able to secure the deal.

John Shevlane, one of our Directors, experienced in managing Business Acquisitions and Management Buy Outs was able to guide the client through the structural change.

Pilot Fish managed the deal from beginning to end, guiding our client through the process and enabling them to continue with the running of the day to day business.

The process

• We conducted a summary review of the business and were able to give the Management Team the confidence that they could secure the funding.
• We supported the management team in negotiations with the owner and drafted heads of terms for the client.
• We helped our client prepare a Business Forecast to best represent their case to their high street bank.
• We referred our client to legal representation for the drafting of the Share Buy Back agreement, and to a Tax Advisor to ensure that necessary clearance was obtained from HMRC.

We were able to secure our client 100% of the Finance for the purchase of the business. The finance was raised through a high Street Bank using both a 10-year term loan at interest rates of below 4% and an invoice discount facility which will also help with future working capital volatility.

The client has since paid down most of its facilities through enhanced trading and the existing profitability within the Business. The Client is now in the position to acquire its own commercial premises.

Jonathan Blythe, Chattertons Solicitors
“Working with Pilot Fish on a deal such as this helps because of their in-depth knowledge and experience. They know what needs to be done and can push for relevant information in a timely manner”

Mark Davies, Managing Director, Gilvar Lining
“Once we had decided to carry out an MBO, we did not know how to proceed and were pleased to work with Pilot Fish to successfully complete the transaction without having to contribute
significant personal funds”

Mohammed Goni, Relationship Manager, Lloyds
“We were able to fund this deal because the information provided by Pilot Fish was complete, accurate and presented in a way that our credit team could understand quickly. We have had similar cases fail because the business owners had not presented the financials and evaluated the performance of the business in such a thorough manner”