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An EOT Implementation Case Study

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As we shared in our recent blog celebrating Employee Ownership Day, the popularity of Employee Ownership Trusts (EOTs) continues to rise. However, many business owners still aren’t aware of the many benefits, such as those covered in our EOT guide, and how an EOT implementation would play out in practice. Therefore, we’ll help explain this with the help of a fictional case study:

The Background & Objectives:

Gareth Northgate is the 100% shareholder of Three Lions Limited. He owes a lot of gratitude to his team that have helped him with some recent success. He’s looking to partially bow out of the business in the future, but he has certain preferences:

Fortunately for Gareth, his accountants are experts in advising on and implementing EOTs, so they discussed this option with him alongside the alternatives such as an MBO and a third-party sale. Following on from this, Gareth has chosen to press ahead with the implementation of an EOT…

The EOT Implementation:

For Gareth and The Three Lions:

The EOT Impact:

Thanks to the implementation of the EOT, employee engagement increased which led to increased productivity and innovation from the motivated workforce. Culture improved too, with employees feeling they have better leadership opportunities and a larger voice in the future of the business. For Gareth, his legacy with The Three Lions remains strong and the culture and values he instilled endured. Whilst this is a fictional case study, studies such as The Employee Ownership Effect have found similar results in other employee-owned businesses.

Fictional to Real:

Of course, this is a fictional case study and every EOT implementation will be tailored to the objectives of the business owners and the circumstances of the business and its employees. To understand more about whether an EOT could be beneficial for your business, download our EOT guide or contact us. Our experience with any exit planning is that it’s better to start planning for each eventuality as early as possible and our experts will be happy to speak to you even if you feel this could be years down the line.

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