We support highly incentivised management teams who
aspire to become entrepreneurs themselves, empowering them to deliver a step change in value within a streamlined business
Our buy-out activities target transaction values of up to €300m.
The types of buy-out we back are wide ranging:
Principally, a management buy-out (MBO) means
that the management team of a business takes over ownership of the
business where they are employed. Often a corporations hives off
one of its subsidiaries by selling it to its management team. In
a traditional MBO the incumbent team of executive managers normally
negotiates directly with the vendor of the business (their former
employer), at the same time as reaching agreement with an investment
institution to back them. Bought deals are increasingly offered.
This is where EXMAG, as the investor, is the principal and negotiates
directly with the vendor, then works out arrangements with the executive
management team. Slightly different from a bought deal is an institutional
buy-out, where a financial institution acquires a business, installs
its own management, and where the financial institution then negotiates
the acquisition of the business, with a view to handing it over
to an MBO or MBI team.The owner buy-out (OBO) is a form of private
placing where an institutional investor buys shares from a shareholder
in a private company who wishes to realise his investment.
source of MBOs is that of family businesses
where the owner wishes to retire. EXMAG enjoys creating entrepreneurs
by implementing management and employee buy-outs (MEBOs), an MBO
where a substantial number of employees, as well as managers, hold
shares in the company.
Secondary buy-outs, also known as a "buy-out of a buy-out", mean that the original MBO managers will sell the company to the next generation of managers.
sometimes MBOs go wrong. In such circumstances a rescue after
an MBO (RAMBO) may be required (see Rescue).
We also support management buy-ins (MBIs) as another means of changing the
ownership of a business whose owners wish to sell. The incoming management team
acquires the business with backing from institutional investors, as opposed to an
MBO, in which incumbent managers acquire it.
Buy-in growth-opportunity (BINGO), a kind of MBI where a significant proportion
of the funding raised goes toward expanding the business.
Buy-in-management-buy-out (BIMBO), a combination of an MBI and an MBO. In
a deal of this kind an entrepreneurial manager buys into a company and teams up with
members of the incumbent management team to run it as an independent business.
Leveraged buy-outs (LBOs) are MBOs in which the equity capital is supported by a
very large amount of debt.
Mezzanine (later) stage investing represents a form of debt arrangement commonly
incorporated in buy-outs. In most deals there are three financing components: standard
debt, mezzanine debt, and equity.
We are also interested in spin-outs: when divisions of a corporation become
independent, either because the divisions have been taken over, or through an MBO.
In most cases, the division is not regarded as fitting into the core business of the parent
If you would like to discuss your buy-out intentions or
submit a completed business plan, select the link below, and we
shall get in touch with you within three working days.