A founder is retiring and I want to lead a management buyout — how do I fund it?

A management buyout lets the team that runs a business own it; acquisition finance funds the purchase, serviced by the very cash flow the buyers already understand. In a management buyout the buyers already run the business, understand its cash flow and carry no learning curve. That makes an MBO one of the more fundable acquisitions.

A founder is retiring and I want to lead a

2 min read

Team takes overKnown quantity

Acquisition financeFunds the MBO

Self-servicingFrom trading cash

Why an MBO is a strong candidate for finance

In a management buyout the buyers already run the business, understand its cash flow and carry no learning curve. That makes an MBO one of the more fundable acquisitions.

Fund the purchase

A business loan funds the buyout, serviced by the trading cash flow the management team already knows intimately. Run the figures through the affordability calculator to confirm the deal stands up.

Agree a fair, clean transfer

A fair valuation and clean documentation protect both the retiring founder and the incoming team. Take proper legal and tax advice on the structure.

What it means for you

Credicorp lends to your company, not to you personally, and takes no personal guarantee. See business loans or apply online when the numbers work.

Frequently asked questions

Can I finance a management buyout?

Yes. Acquisition finance funds an MBO, and because the management team already runs the business, its known cash flow services the borrowing — a strong basis for lending.

Why are management buyouts easier to finance?

Because the buyers already understand and run the business, there's no transition risk from an unknown owner. Lenders view that continuity of proven management favourably.