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Employee Ownership Trusts
What is an employee ownership trust (EOT)?
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.