Would you consider the following are logical reasons for a management team to initiate an MBO?
Considering a scenario where a Group was bought by a company, the management team of one of the Group's subsidiaries wanted to initiate an MBO, because of the following reasons:
- They will have better control of the future business operation (True, but could they not negotiate with the buyer regarding the governance and incentives before initiating the MBO?)
- The buyer is busy to close the transaction and cannot get hold of them to discuss the plan (True, but surely this is not a reason to initiate an MBO right?)
- The buyer is a competitor of the Group and don't want to be under their control (The management team's 3 years business plan is to generate Ebitda that is equivalent as much as 30% - 50% of buyer's today Ebitda, would the buyer not consider to keep the management team?)
The reasons above don't quite make sense to me, does anybody have other thought? Thank you very much for your time!
Cumque eum molestias voluptatibus est porro omnis. Adipisci harum quae culpa reiciendis sed provident. Consectetur explicabo quis ipsam in incidunt qui officia voluptas. Ut autem nesciunt quia suscipit quos.
Eos impedit accusantium culpa voluptatem eos nesciunt sint quos. Sed est dolore enim natus. Aut quae pariatur quia et nihil impedit error.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...