Locking in your key employees is always a balancing act between work life balance, remuneration packages and showing employees they are valued and part of the very fabric of the organisation.
One of the most effective ways of imbedding employees into your business is through capital ownership, which provides a shared goal towards exit and increasing value.
This is a powerful way to tell a key employee of their value to the business and can create an “in this together” attitude.
Such a structure creates rewards for all on a fair basis through the eventual sale of the business.
One of the most popular types of employee share option schemes with SMEs is enterprise management incentives (‘EMI’).
EMI schemes are a popular way of attracting and retaining employees and they can provide significant tax benefits.
What do Riverford, the organic vegetable box company, Richer Sounds, the hi-fi chain and Turleys, the planning consultancy have in common? Well, as from May 2019, they are or are about to become employee owned businesses with Julian Richer being the latest business owner to announce he is transferring 60% of his shareholding into an Employee Ownership Trust (EOT).
If you are a business owner, in business with one or more partners, have you taken time to consider what might happen to the business if you, or one of them, were suddenly not around or capable of taking part?
Bermans’ corporate team advises individuals, families and their advisors on the formation, structuring and ongoing governance of FICS as an effective vehicle for wealth preservation, succession planning and tax-efficient asset management. FICs enable families to retain control over investment strategy while passing value to the next generation in a structured, long-term manner.
Working in collaboration with tax advisors, wealth managers and accountants we can help clients navigate the regulatory and compliance requirements relevant to FICs while also addressing key considerations such as confidentiality, control and risk management.
How can we help?
We would always recommend seeking professional accounting and taxation advise before deciding to put a FIC structure in place but, if you do decide that a FIC would be right for you, we can assist in all stages of its implementation, from incorporating the FIC entity, drafting its constitutional documents, and dealing with the transfers of shares both to it (in other companies) and in it (to family members or trusts).
We act for business owners, trustees and management teams on the structuring, establishment and implementation of EOTs.
EOTs provide a tax-efficient and employee-aligned alternative to traditional MBOs, trade sales, listings and assets sales and enable owners to sell their business to a trust that holds the company for the long-term benefit of its employees. Our experience of EOTs mean that we have understand the unique requirements and dynamics of selling to an EOT, including maintaining operational continuity and establishing effective trust governance.
We can assist with:
Setting up the company to act as the trustee of the EOT
Preparing the trust deed between the company and the EOT trustee, detailing the terms on which the company’s shares will be held for the benefit of the employees
Preparing the constitutional documents of both the company and the EOT trustee
Drafting and advising on the share purchase agreement relating to the sale of the shares to the EOT trustee
Advising on any documents or structures relating to the funding of the transaction.
If you’re an owner exploring exit options or an advisor supporting a client’s transition, we’d be happy to provide our support and practical guidance to assist with discussing the benefits of implementing an EOT structure.
A share buyback (a process whereby shares in a company are bought by the company itself and cancelled) is a popular and relatively less-complex way for companies to provide an exit route for, or return surplus cash to, its shareholders. Whilst the law and procedure for carrying out a share buyback is quite clear and straightforward, we have dealt with a number of instances where the validity of a share buyback has been questioned and further action required to be taken in order to ratify the validity of a buyback transaction.
In this article, Jon Davage outlines some pointers for those seeking acquisition opportunities via an insolvency process.
The folding of a company may be catastrophic for the stakeholders of the relevant company, but insolvencies provide buyers with the ability to acquire assets and valuable customer contracts at reduced prices. However, acquisitions of this type are not without their perils and often have hidden costs. Here are some issues to consider before you embark on this type of deal.
Whilst being nothing new to the market place, the Enterprise Investment Scheme (EIS) introduced over 20 years ago has been the launch pad for many ideas and developments that have gone on to bring great return and growth for small high risk companies that would have otherwise struggled to raise debt or equity finance.
‘FinTech’ or financial technology is a phrase increasingly used in the media, the finance sector and the business world in general. In the broadest sense, financial technology is any technology that is used and applied in the financial services sector which improves the delivery of financial services. But what does that mean and why should you care that it is one of the fastest growing areas for venture capitalists or that the sector generated almost £7billion revenue in 2016?
Robin joined Bermans in December 2015 and became a Partner in the Corporate department in 2022.
He qualified as a solicitor in 2011 having trained in London.
Robin advises clients ranging from start-ups to large companies on a range of corporate matters including mergers and acquisitions, private equity and venture capital investments, reorganisations, joint ventures, incorporations and corporate governance issues. He also regularly advises on employee share and incentive schemes.
Robin was ranked by Experian Corpfin as first in the North West for deals worked on in 2013, 2014 and 2018 and also first in the UK in 2014.
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Locking in your key employees is always a balancing act between work life balance, remuneration packages and showing employees they are valued and part of the very fabric of the organisation.
What do Riverford, the organic vegetable box company, Richer Sounds, the hi-fi chain and Turleys, the planning consultancy have in common? Well, as from May 2019, they are or are about to become employee owned businesses with Julian Richer being the latest business owner to announce he is transferring 60% of his shareholding into an Employee Ownership Trust (EOT).
