Management Buyouts
& Buy-ins
Which situations does MBO and MBI finance cover?
A buyout hands a business to the people best placed to run it. The debt is repaid from the profits those people go on to generate, which is why lenders back strong teams even when they have little capital of their own.
A founder or owner selling to the existing management team, often over a phased period, with the price funded by debt and deferred payments rather than an outside buyer.
An external manager or team buying into a business in a sector they know, bringing new leadership, sometimes alongside members of the existing team in a buy-in management buyout.
The owner sells a majority now and the balance later, staying involved through the handover. Debt funds the first stage and the business funds the rest.
Management taking full ownership from a private equity or institutional shareholder at the end of an investment period, refinancing the equity with debt.
How an MBO comes together
Discovery call
Lender terms provided
Funds issued
What lenders look at
Senior debt, mezzanine or vendor loan note?
*Indicative only. Proportions, pricing and terms depend on the lenders, the business and the deal agreed with the vendor.
Discuss a buyout
Tell us about the business, the team and where the conversation with the owner has got to, and one of our corporate finance advisers will call you back, usually the same working day.
Client Testimonials
MBO and MBI FAQs
In a management buyout the existing management team buys the business from its owners. In a management buy-in an external manager or team buys into a business and takes over its leadership. A buy-in management buyout combines both, with an incoming leader joining the existing team.
Lenders expect the team to have meaningful skin in the game, but that is measured against personal means rather than the deal size. Contributions are often modest in absolute terms. What matters is commitment and a credible plan.
In layers. Senior debt from a bank or specialist lender forms the largest part, secured on the business's assets and cash flow. Mezzanine debt can fill the gap on larger deals, and the seller often defers part of the price through a loan note.
An agreement for the seller to receive part of the price in instalments after completion, usually ranking behind the lenders. It reduces the day-one funding requirement and keeps the seller invested in a smooth handover.
Typically eight to twelve weeks from agreed heads of terms, allowing for lender due diligence, legal documentation and the sale and purchase agreement. Preparation beforehand, particularly a robust forecast, shortens the timetable considerably.
Yes. Phased or partial buyouts let the owner sell a majority stake now and the balance later, often staying involved through the transition. The first stage is funded with debt and the remainder from the business's own cash flow or a later refinance.
That is the central question lenders ask, and we model it before approaching anyone. Debt is sized so that repayments sit comfortably within forecast cash flow with headroom for a weaker year, and the price is tested against what the business can realistically support.
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