Management Buy-in (MBI)
Updated: 11th February 2007 (PM)
A Management Buy-In ("MBI") is when a business is sold to an outside management team.
An MBI usually occurs when:
- the business is underperforming and would benefit from additional management input
- the MBI team have specific sector knowledge and can take the business forward
MBI's are traditionally more difficult to fund than MBO's. The lenders have to be convinced that the MBI team (or MBI candidate) have a sufficient experience and the ability to deliver.
An MBI candidate would typically have to have the following attributes:
- a proven successful business background
- a business leader with drive and enthusiasm
- able to risk personal capital
At Sterling Capital Reserve Ltd, we regularly act for MBI candidates in respect of business acquisitions. MBI's do not necessarily have to be multi million pound businesses. We have acted for many MBI's in respect of businesses in the 500k to 5million turnover sector.
With access to many innovate and aggressive debt finance providers, many of our MBI's have been funded without the need for Venture Capital.
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