Management Buy Out
- Risk that good management members are not necessarily good entrepreneurs and thus success fails to materialise.
- Management overstretches itself with the financing and is thereby also overly burdened privately.
- If several management members take over, there is a risk of conflicts over ideas of leadership, strategy and competencies.
- There is no realistic family internal succession in sight
- There is confidence in the existing management that they are able to transition from the role of employees to the role of responsible entrepreneurs.
- Clarification of the role of the seller after the handover
- Healthy financial basis of the company in terms of earnings and cash flow, so that the financing of the purchase price can be guaranteed.
- Possible willingness of the owner family to help with financing through loans.
- Sufficient equity of the buying management.
- Possible hedging modes of loans of the seller.
- Confidence of the banks that the buyers will successfully continue the business. This is a prerequisite for securing financing for the purchase and securing the necessary liquidity from the banks.
- The management's resistance to an external successor, which often occurs, is eliminated.
- This also creates a certain continuity for the employees and many uncertainties that arise with an external solution do not arise.
- The disclosure of information that is necessary in the case of a sale to an external successor is eliminated, and with it the danger that this information will reach places that are not desired.