Fieldfisher's employee ownership (EO) team has continued its record year for employee buy-outs, most recently advising civil engineering business Tonic Construction on its move to EO.
Corporate partner, Mary Erb in the firm's Manchester office carried out the corporate work on this transaction, which saw the shareholders of the parent company of Tonic Construction transfer 80% of ownership to an employee-owned trust (EOT).
Tax work for the transfer was carried out by Tamsin Nicholds in Fieldfisher's London tax team and BDO LLP .
Tonic Construction Ltd is a civil engineering and groundworks contractor based in Swindon. The firm works with national housebuilders, management contractors, local authorities and private developers.
Founders Tony Iles (Chairman and MD) and Deborah Iles are retaining the remaining 20% of the company. Tonic will continue under the same leadership team led by Tony, who founded the business in 1999.
Tonic's move to EO is part of a growing trend that has seen a number of engineering and construction companies move to employee ownership, following a wave of transitions in the design and architectural industries.
Mary Erb recently completed an EO transfer for architects Buckley Gray Yeoman in June and the firm-wide team has assisted multiple clients including Riverford Organic, PAYE Stonework & Restoration and law firm Hodge, Jones & Allen on adopting EO models.
Commenting on his company's move to EO, Mr Iles said:
"This is a really exciting move for Tonic Construction, enabling us to realise our ambition to become a trans-generational business, and guarantee intercompany loyalty and succession."
"The collective ownership by all the team, secures the future of the business and our core values, meaning we can long outlast the founders and senior team without the threat of a takeover or sale that could result in a dramatic change in business culture".
Fieldfisher corporate partner Mary Erb commented:
"It was a pleasure to work for Tonic Construction and we congratulate the firm on its transition towards becoming employee owned. Our thanks also go to BDO LLP for referring Tonic to us."
"By widening ownership of the business, Tonic Construction is sure to secure the future of its business and ethos."
Fieldfisher has been advising on employee buy-outs for a number of years.
There is a growing body of evidence that the employee ownership structure is a way of future-proofing businesses.
Increasing numbers of small and medium sized enterprise owners are concluding that protecting the independence of their business, while emphasising the need to benefit employees, means that moving to an employee ownership model is the most appropriate exit route as founders of those businesses plan for their retirement.
For more information on Fieldfisher's EO expertise, please contact one of the employee ownership team.