What should an MBO Team consist of?
If an MBO is going to be successful, then the quality of the management team is essential, and lenders will need to be convinced by the team. Experience, enthusiasm, entrepreneurial characteristics, and a commitment to the buy-out need to be evident.
Funders will need convincing that the management team has all the skills to manage the business independently. The management team must also have a clear strategy for growing the business.
A typical management team will include up to three or four managers:
- Managing Director or CEO
- Finance Director if an MBO
- Sales Director
- Production, Technical, or Operations Director
Other managers and staff may also be given the opportunity to invest through share options.
A truthful assessment of the team’s strengths and weaknesses should be carried out early, with flaws addressed. The team can be strengthened by recruitment before or after completion.
Engaging the services of Sterling Capital Reserve early means we will work with all the parties and their respective advisers. This ensures the management team continues running the business through to the completion of the transaction.