Agile Independent Management Consultancy firm transitions to employee ownership
Clarasys is an independent management consultancy started in 2010 by the three founding director shareholders. The business provides consultancy services on business change, technology and agile delivery techniques which deliver sustainable business improvements for a wide range of clients, from small not-for-profit organisations to large multinationals. They have offices in London and in Boston in the US.
At the time of the EOT transition, the company had approximately 95 employees and had recently been placed 3rd in the Sunday Times Top 100 Best Small Companies To Work For in 2019. It was their second top 20 placement by the Sunday Times in the last two years.
It has also been awarded the maximum of 3 stars for extraordinary levels of Workplace Engagement.
The three founding director shareholders have worked extremely hard to instil a collaborative culture amongst staff, which is key to their business’ ongoing success.
The management team were looking for a planned partial exit that would not jeopardise its independence and its unique culture, as would have been the case if they had sold the company to a third party or sold a stake to an investor.
The leadership team discussed the EOT proposal with all members of staff and held proportionally representative elections to appoint an employee to the board of the EOT.
The EOT was an ideal solution for the company as it enabled the management team to partially exit by selling 60% to the EOT in return for deferred consideration to be paid to them over a period of time, subject to company performance.
By selling a controlling stake to the EOT it enabled to company to make a commitment to its employees for the long term through the all-employee nature of the EOT and to further reinforce the collaborative culture of the company.
RM2 assisted the company with the financing of the deal, valuing the business and the structuring of the repayment of the deferred consideration. It is expected that the shareholders in the Company will be paid their deferred consideration over the next five years. The sellers will also earn interest on the amounts outstanding. Capital repayments to the shareholders should be free of capital gains tax.
RM2 also assisted with the legal documentation as well as incorporating the trust company and overseeing the implementation process.