Employee Ownership Trusts or EOT’s are best illustrated by John Lewis – all of the staff are beneficiaries of a trust that owns the company.
Some reasons why a seller might consider an EOT are:
- It can be a seamless way to sell the business which is well received by staff, customers and other stakeholders, while leaving the outgoing owner in a senior operational role, remunerated as an employee at a market rate.
- Under the right circumstances there will be no capital gains tax to pay.
- Evidence seems to suggest that EOT ownership can drive very positive behaviour from employees who can also benefit from tax breaks and a feeling of ownership.
“Steve is knowledgeable, professional and incredibly well informed … and will use him for my next acquisition in the future. “ Haydn Davies, HDI Ltd