Fieldfisher advises on PB Design employee buy-out
Graeme Nuttall OBE leads Fieldfisher team on advising PB Design and Development's move to 100% employee ownership
A team from Fieldfisher led by partner Graeme Nuttall OBE advised PB Design and Developments Limited and its holding company (together, "PB Design") on introducing 100% employee ownership to the business. Recognised as leaders in standby power solutions, PB Design is an engineering firm which has, since 1979, developed and brought to market a full range of innovative and cost effective power solutions.
Tim Broomfield, PB Design's MD, bought PB Design from its founder Paul Britton in a conventional management buy-out in 2007. Tim and the management team have always recognised the vital role of all staff in the company's success. PB Design is a Gold Standard Investors in People Organisation. The company has made use of tax advantaged profit-sharing and share option plans as add-ons to the usual corporate model but decided the employee-ownership trust, introduced in 2014, offered a new better business model. Recent research published by the Chartered Management Institute highlights the benefit of this business model.
On 14 July 2015, PB Design Employee Trustee Limited (the "Trustee"), as trustee of the PB Design Employee Ownership Trust ("PB Design EOT") bought 100% of the shares in PB Design from Tim Broomfield, Andy Hooper and Steve Smith to give the PB Design EOT complete control of PB Design.
Other members of the Fieldfisher team included partner Neil Palmer and senior associate, Jennifer Martin.
Graeme Nuttall OBE partner Fieldfisher and chair of the Trustee board of directors said of the buy-out:
"100% employee trust ownership provides a practical and comprehensive way forward for PB Design. This is a move from the traditional model of a few managers owning and governing, to all employees having a stake in their business. This sustains and reinforces the existing good employee engagement. The new structure means employees via the PB Design EOT have a permanent financial interest in the profits of PB Design and there is no need ever again to plan for who will succeed to the ownership of the company."
Tim Broomfield, MD of PB Design and former majority shareholder said:
“This is an important event which secures the future independence of PB Design. It also creates a clear link between employee engagement, performance, and reward. Success continues to be measured by the satisfaction of our customers, but is now permanently aligned with that of our Employee Owners. It is a win-win-win situation – existing shareholders get fair value; employees own their business; and customers have a highly motivated supplier. Add in the tax benefits to shareholders and employees and it becomes an even more attractive option for any ownership succession plans. We thank Fieldfisher for their technical expertise in guiding us through this area of recent and complex legislation.”
Ann Francke, Chief Executive of the Chartered Management Institute, said:
“Employee ownership goes hand in hand with more democratic management styles. Our research shows the benefits are clear, with high levels of employee commitment, more caring ethical mindsets and a more long-term approach to business decisions. The economy would benefit from having more employee owned companies and we can all learn from their example.”