Advice needed on buy-out

[AnnaS]

Hello All,

I am new on this forum so I hope I am placing this in the right place....

I need some advise on where to get advise...

My partner is one of 2 Directors in a small Ltd, they both hold 1 share each equating to 50% share in the company each. The other partner is now leaving the company and my partner is buying him out. They have already negotiated a price however now things have come to a halt as financing is proving to be difficult to understand. We would need advice on the following:
- Advise in financing the buy out
- Advise on the legal changes and requirement (the leaving director is also the Company Secretary)
- Advise on the required paperwork and contracts

Who would we contact to provide this advise? Ideally we would be looking for a one-stop-shop to assist my partner through the entire buy-out. Some have advised to contact a good corporate accountant/business advisor?
The company already has a sollicitor and an accountant however, the accountant does not show much initiative to help.

Any help would be much appreciated!

[accountantpete]

Hi Anna

Financing is usually obtained from the bank which may involve a personal loan taken out by your partner in order to pay the other director off. Alternatively the amount owing could be converted into a loan account which pays the loan off over a fixed number of years out of annual profits and pays an agreed rate of interest annually.

The share will need to be transferred to your partners name through a stock transfer form and Companies House notified of the resignation of the Director and Secretary - all of which the existing accountant can do quite easily. There also matters involving the valuation of the shares - again discuss this with the accountant.

If this fails look around for a new accountant.

[AnnaS]

Hello Pete,

That's really helpful, thank you!

The bank has actually already agreed to the loan, 75% of which will be secured by the business premises but the remaining 25% would need to be secured on our home. As we do not know what the ramifications are of this ie when we would like to move or take out a new mortgage, we are reluctant to do this. There are also funds available privately which could be used a Directors Loan to supplement the loan and hope that by reducing the loan amount from the bank we can avoid to involve our house.

Perhaps we should just go back to the accountant and put everything to him and hopefully he will prove a bit more willing to help then before!

Thank you for your time!

Anna