Employee Ownership Trusts: Your Legacy, Their Future
Thinking about selling your business but want to protect its legacy, your employees, and its long-term success? An Employee Ownership Trust (EOT) could be the ideal solution. More business owners are choosing to sell to an EOT as a tax-efficient, values-driven way to transition ownership while keeping the business independent and thriving. Whether your priority is rewarding your team, preserving your company’s culture, or securing a sustainable future, an EOT offers a succession plan that aligns with your values.
From this page, you can explore the benefits of employee ownership, how the EOT process works, and read success stories from businesses that have made the transition. Discover insights into The Grand Bargain, the role of trustees, and expert blogs on why EOTs are gaining momentum. Whether you’re at the start of your journey or ready to take the next step, vfdnet is here to help you navigate the path to employee ownership with confidence.
EOT Blogs
vfdnet FD role in your transition to an EOT
Our Virtual Finance Directors have built up sound experience of business sales into Employee Ownership. They are not only your financial expert but they also project manage the process and are the lynch pin holding it all together. They know what a solicitor should charge and can answer or field questions, saving you time and money in fees.
Your vfdnet FD is likely to start with a business valuation using our model. Our business valuation model also helps to identify the realistic payment period for the consideration, with payment periods ranging from 5-8 years. They will talk to you about the implications, financially and practically, of what a sale to your employees will mean to you and your management team.
They then create a scope for the specialist law firm. It’s usual to take the scope to three EOT lawyers to get a comparison.
vfdnet FDs have built great relationships with solicitors who have experience with Employee Ownership Trusts so they will guide you as to who to use. Your Virtual FD will be able to lead you on the process and manage the relationship and milestones with your solicitor, help keep your EOT on track and on budget. Your vfdnet FD will draw up a deal cost budget, then project manage the deal to time and cost.
Where the Business Owner wishes to be paid more on Completion than is available in the business, bank funding needs to be sought. vfdnet FDs work with clients to draw up their narrative and financial business plans and help negotiate bank terms and covenants. We also recommend doing our Exit ReadiMap ® diagnostic review, which provides confirmation of strengths, but also reveals ‘blind spots’ which can be ironed out before the transaction. This in turn helps in preparing for the Due Diligence process, which is either required by the funders, or is good practice as part of the warranty and disclosure process.
Your vfdnet FD will walk you through all of this and do what is appropriate for your business situation.
Is an Employee Ownership Trust right for your business?
You’ll have questions, probably quite a few, that relate to your business and the people involved. Organise a chat with James Shand in complete confidence to discuss what’s involved and if you’re ready. He’s got over many years experience of making the transition to an EOT as smooth as possible for the business owner and getting you the deal you want for you and your staff.
EOT Clients
