Management Buyouts (MBOs) in the UK are experiencing a notable resurgence, particularly within the mid-market segment. According to recent industry reports, the volume of MBO activity has increased significantly — a trend expected to continue into 2026 and beyond.
But what’s driving this renewed interest in MBOs? And how can businesses prepare for a successful management buyout? Chris Jones, Corporate Finance Partner here at Bates Weston explores the topic further.
What Is a Management Buyout (MBO)?
A Management Buyout is a transaction where a company’s existing management team acquires the business from its current owners. This provides continuity while allowing founders or shareholders to exit, often as part of a wider succession or retirement plan.
Key Drivers Behind the Increase in UK MBO Activity
Several market forces are contributing to the increase in UK MBOs:
- Succession Planning for SME Owners
Many UK SMEs are run by ageing business owners with no clear succession plan. An MBO offers:
- A structured exit for founders
- Continuity for employees, clients, and suppliers
- A trusted management team already familiar with the business
- Market Volatility and Valuation Opportunities
Economic uncertainty can suppress business valuations. For management teams with insider knowledge, this presents a strategic opportunity:
- To acquire businesses at more favourable valuations
- To unlock future growth potential with operational control
- To attract private equity (PE) backing with their proven leadership
- Increased Availability of MBO Funding
Access to capital has improved, with multiple funding routes available:
- Private equity firms looking to deploy dry powder
- Banks and alternative lenders keen to support experienced management teams
- Hybrid funding structures blending equity, mezzanine, and debt
- Desire for Cultural Continuity and Strategic Autonomy
An MBO helps preserve:
- Company culture and strategic direction
- Customer and employee confidence
- Operational knowledge and market insights
- Favourable Private Equity Trends
The number of private equity-backed MBOs is increasing, particularly in:
- Mid-market deals (£10m–£100m)
- Public-to-private transactions as management teams delist businesses to gain control
Additionally, changes to the UK Capital Gains Tax (CGT) regime have prompted many shareholders to consider MBOs as a tax-efficient exit route.
How Bates Weston Corporate Finance Supports MBOs
At Bates Weston Corporate Finance, we provide end-to-end support throughout the management buyout process — from feasibility and valuation to deal structuring and completion.
Our MBO Services Include:
Pre-Deal Feasibility & Business Valuation
We help assess whether an MBO is viable by analysing:
- Business fundamentals and market positioning
- Strength and cohesion of the management team
- Indicative business valuation and potential deal structures
- Likely investor appetite and funding availability
Deal Structuring & Fundraising
We guide you through deal structuring based on the needs of:
- Shareholders exiting the business
- Incoming management buyers
- Equity and debt funders
This includes negotiating terms such as:
- Deferred consideration
- Earn-outs and anti-embarrassment clauses
- Shareholding structures and governance terms
Our team also helps you prepare:
- Robust business plans
- Integrated financial models with sensitivity analysis
- Funding decks to present to banks, lenders, and private equity firms
We’ll leverage our deep network of funders to secure competitive MBO financing and lead commercial negotiations on your behalf.
Deal Execution & Completion Support
We manage the critical final stages of the MBO, including:
- Coordinating financial and legal due diligence
- Supporting the financial disclosure process
- Assisting with balance sheet “true-ups” in line with the Share Purchase Agreement (SPA)
- Liaising with legal counsel to secure the interests of the management team in all contracts
Why Choose Bates Weston Corporate Finance?
With decades of experience advising UK businesses on Management Buyouts, we combine:
- Deep corporate finance expertise
- Long-standing relationships with funders and private equity firms
- Integrated tax and legal support to ensure your deal is tax-efficient and legally sound
Our MBO specialists act as your trusted adviser and project manager, helping you navigate the complexities of a transaction while you continue to run the business.
Ready to Explore a Management Buyout?
A successful MBO can be a life-changing event for management teams and a legacy-defining decision for owners.
If you’re considering a Management Buyout — whether as an owner planning your exit or a management team exploring options — contact Bates Weston Corporate Finance for an initial, confidential discussion. We can help you make your MBO a success.
