Selling Your Business
The Mobius Capital Way01
Discuss
We first ask to have an initial discussion with you about your business, how is it performing at the moment, what is it that you want to achieve from the sale of your business, what staff you have and what skills they have or are missing.
We use this information to build up a plan of action to take your business forward.
02
Prepare
Preparation, Preparation, Preparation – We will work with you to build processes and procedures for your business to prepare it for an eventual move towards employee ownership. Preparing your business will ensure that you meet the criteria of the Employee Owned Trust benefits.
Implement
Implementation of the sale process is performed by professionals, those that have experience in the tax, accountancy and legal consequences of selling your business to an Employee Owned Trust. This is to protect you the seller, the staff, the trustees of the trust and the business itself. Taking the wrong steps could invalidate the HMRC benefits of the trust.
About
About Mobius Capital
Mobius Capital was formed to create a new method of sale for businesses in the UK. By creating the collaborative group of businesses and moving them to staff ownership allows us to assist smaller, independent businesses to create equal opportunity compared to larger national or multinational businesses that are able to use scale to their advantage.
We work with trusted partners to create an Employee Owned Trust for each of our businesses, to identify cost savings when buying services as a group, and finding efficencies and opportunities for collaboration between members. Helping each other to grow stronger, together.
Business Owners wanting to exit within 12 months
Mobius Capital has a number of paths to transitioning businesses, for those where the owner is looking to exit the business within a 12 month period we will follow the fast track transition process;
Business Valuation and review
To secure the HMRC benefits of Employee Ownership we will bring in selected partners to assist in the valuation and intial tax discussions of the sale, these are independant advisors from Mobius Capital and may advise against the EOT process if the business is not in a postion at this time, this will result in the business moving to a longer process.
Implementation of the Employee Owned Trust
Creation of the trust needs to be done following strict guidelines from HMRC to ensure that the tax benefits are able to the exercised. however the trust process is relatively short and we would advise on how to simplify this by using our approved solutions where they are suitable
Implementation of the Staff Council
The Staff Council will need to be created with the rules and regulations agreed and signed off, again, we will introduce a template for this to quicken the process and allow the staff to quickly move to a nomination and voting procedure.
Funding the Initial payment
Mobius Capital will work with funding partners to raise the initial payment for the business, this will be from monies available within the business, Asset Finance other forms of finance available to us, this intial payment will form part of the payment from Mobius Capital for the 26% stake in the business that we will acquire as part of the handover.
Forming the Trust
Creation of the Trust will be completed before the transition of the business, this will include appointment of trustees to manage the trust. Trustees will include representation from the staff council, industry experts and can include in a non executive role the seller of the business if they wish to remain as an advisor to the staff.
Business Transition
Mobius Capital will transition the business to the new owners, Majority ownership will always be with the staff trust, Mobius Capital will assist with the transition period between the staff and the seller, ensuring that the seller is able to exit the business without fear of the business collapsing or not operating correctly.
Group Membership
Mobius Capital will immediately start to integrate the company into the group so that they can receive membership benefits, including preferential purchasing power plus some of the other benefits of the group including, access to other members of the group, sharing resources and growing the business through collaboration.
Business Owners planning to exit in longer than 12 months
Mobius Capital will work with companies who are wanting to plan an exit over a longer period of time, this can include businesses where they are not ready to be transitioned to an Employee Owned Trust. For those businesses with more time for the transition, we can help to prepare the business for the changes needed to transition them.
Business Valuation and review
As per the main process a review of the current valuation and position of the business will be carried out, this will assist in determining the work required to prepare the business for transition. The Valuation will be used as part of the deal structure to calculate when the business will be ready for transition what value the owner will agree for the sale.
Group Membership
Becoming a member of the Mobius Capital Group and achieving potential savings to increase valuation and also raise money to pay for the implementation of the changes identified in the review process. Increasing the benefits within the business to prove the worth of the changes being implemented.
Implementation of Review Recommendations
Changes identified in the initial review to be implemented, these will be business dependant but will likely include implementing changes to the leadership team to ensure the business is able to continue without the current owner, moving them from a direct management role to one of a mentor of the newly appointed leadership team.
Implementation of the Staff Council
implementing the staff council before the employee owned trust allows the council process to be embedded within the management team and providing experience of the council on how to operate, training the staff on nominations and voting procedure giving staff more time to embed the process and iron out any issues.
Revaluation of the Business
After changes have been implemented, the business will be revalued based on agreed method, this new valuation will form the valuation for the HMRC approval of the new Employee Ownership Trust to be created, where applicable this will be used to validate the work completed by Mobius Capital.
Forming the Trust
Creation of the trust will be completed by expert legal partners who will create the legal entity of the trust with the relevant trustees being appointed. The trustees will be made up on representatives of the employees, and relevant industry experts to assist in the running of the trust and the maintenance of standards for the trust.
Business Transition
Mobius Capital will transition the business to the new owners, the exact shareholder ship will be confirmed at this point with the potential of bringing in other owners into the mix including potential for the sellers to retain a minority share holdership. The new board of directors for the business will be appointed includeding the staff council and also represetation of Mobius Capital.
Staff Council
Creating empowerment with the staff is an important part of the Mobius Capital methodolgy and matched by the componants of the Good Business Charter for which we are members. Part of this empowerment is to allow the staff access to the senior leadership teams within the business and to have their views represented at the highest levels of the business.
Therefore, for each of the businesses that join us we will look to create a staff council who will be elected by members of staff and will represent all employees on the board of directors and also act as trustees within the employee owned trust once created.
Mobius Capital will support the Staff council by providing training and also give them access to other staff councils in other businesses within the group, so that they can share ideas and work together. This collaborative environment will encourage the council to be involved in the business and pass this onto the staff.
Trustees
The Employee Owned Trust will require a group of trustees to assist in the running of the business, they are charged with representing the employee interests with respect to the business. The trustees will also be responsible for ensuring that the trust follows the law with respect to set up and operation of the trust.
Trust members are made up of expert advisors, members of the staff and those that have a vested interest in the business success. This could include the previous owner as long as their influence is not controlling.
Group Benefits
Creating a collaborative gtoup of buisnesses allows us to share experiences across multiple industries, creating opportunities for the staff to interact is therefore an important part of the Mobius Capital plan.
Additionally, having a group allows us to look for opportinities to cross sell goods and services to each other, and to our customer base. Creating a trusted brand of collaboration and good business practice allows us to know that we are able to honestly recommend others within the group
For the staff, it allows them access to opportunities to move between businesses to persue opportunities whist retaining access to staff ownership, and a sense of belonging to the group.
We are also able to look at centralisation of shared services, allowing us to create new businesses offering services to the rest of the group and externally, opening up new revenue avenues for the group as a whole but also new opportunities for staff to asssit in the creation of these services.
Benefits of Selling, the Mobius Capital Way
Creating a legacy for your staff
By selling your business to us, you will be passing the business to your staff, we partner with your staff to create an employee ownership trust, which will give the benefit of business ownership to your staff. Allowing them to work with us to maintain your business for themselves and future employees.
Your business will also join the group of companies that we will build to support each other to ensure that the business can and will last for another 100 years
Maintain consistency
Because we are looking to acquire the business with the staff and maintain the business for at least 100 years we are not looking to quickly resell your business to the next buyer. We are in this for the long haul so your business will not be sold to a competitor or strategic buyer to be broken down and dismantled.
We also do not want to merge your business with another or lose your business name. We will look for opportunities for us to acquire other businesses and will work collaboratively with these businesses but will not be looking to force a rebranding of the business.
Getting the Value for your Business
Business buyers will usually be looking to acquire your business for the least amount of money, although we are limited by the rules of employee owned trusts to not overpay for the business, we are committed to paying the full value of the business.
By selling the majority of shares to an employee owned trust you can also benefit from a zero-rated capital gains tax valuation. this can save you approximately 15% of the total value of the business.
Tax Efficient Sale
Selling your business will incur Capital Gains tax, this can be reduced to 10% using Business Asset Disposal Relief, however, when joining Mobius Capital you are creating an Employee Owned Trust which will be acquiring a majority share of the business, this will create a zero rated sale.
The amount of the business that Mobius Capital acquires will be still incur Capital Gains Tax, but this can be minimised as much as possible.
This means that as the seller of the business you will retain more of the value of the business which can go towards your retirement, a new project, or whatever it is that you want.
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We are based in Sheffield but cover the whole of Great Britian
Contact Us
07932 437454
Info@Mobius-Capital.com
Office Hours
Mon-Fri: 9am – 5pm
Sat-Sun: Closed