The deal completed on 1 October and as a result 55-year old managing director Bryan Godwyn has retired, although he will support the business part-time until the end of the year. Eric Keane, who joined the firm last year as director for business development, buying a 40% stake at the time, steps up to the MD role.
Jason Seaber remains technical sales director.
Godwyn, Keane and Seaber sold their respective stakes, 40%, 40% and 20% to the trust as part of a succession plan to take the business, which is the exclusive UK reseller of Horizon finishing kit, through the next stage of its development after posting a record year in 2018 in terms of sales profits.
Keane described the deal as a “real win-win, for staff, the owners and customers” because it ensured that the business continues to offer best in class products supported by best in class service and support “delivered by people that own the business”.
Keane said he, Godwyn and Seaber had been thinking about an exit strategy for some time, but that when they settled on an EOT offering the best outcome for themselves, the business and the staff.
“Bryan’s been the real engine driver of the business for the past 30 years and his legacy will continue, but he set himself the goal of retiring at 55 and has achieved it,” said Keane.
“We worked really hard last year and posted record results and that has helped enable us facilitate doing this.”
He highlighted that the EOT leaves the £10.5m-turnover business in the strongest possible position in terms cash reserves and a strong balance sheet.
The structured earn-out was funded by the business, with no external borrowings required that might put a strain on the business.
“We wanted to ensure that we ‘leave’ the business strong with plenty of cash and a strong balance sheet.”
He said that deal had been well received by Horizon and that EOTs were an ideal exit strategy for fiscally strong businesses that didn’t have a natural succession plan.
In terms of his plans for the future, Keane quipped: “We’ve got a young management team and the cream always rises to the top. I want someone knocking on my door in a couple of years’ time saying, ‘I want your job’. That’s fine by me.”
Under the EOT, all employees with a minimum 12-months service will become shareholders in the business and benefit from a profit-sharing scheme, the first £3,600 of which is tax free for employees each year.
While the executive board will now consist of Keane and Seaber, on a day-to-day basis the business will be led by a senior management team consisting of four long-term employees: head of technical services Gareth Read, operations manager Kelly Moore, credit control and HR manager Marion Cooper and technical services administration manager Michele Faulkner.
Godwyn, who while retiring from his executive role, will become a trustee of the EOT, said: “We wanted to ensure that it would be a succession plan preserving the good name of the company and enabling it to continue its development along the current path.
“We have always valued our independence. It is something that’s in our culture, as we believe it promotes the very best creativity, commitment and sense of belonging by the whole team. It enables us to have a real identity in what we do and deliver the very best customer experience. We are glad to say that the EOT enables this to continue.”
The trust board consists of Godwyn, two employees elected on a two-year term and an independent trustee for oversight.
"Now we've just got to get on and make it really work and be really successful and make sure everyone gets a nice bonus at the end of the year," said Keane.
As well as being the exclusive UK agent for Horizon, the Hemel Hempstead-based business supplies equipment from Durselen, Foliant, Italdibipack, Perfecta, Petratto, SCS and Tecnau.
IFS was advised by EOT expert advisors Avondale Corporate.
