Management Buy-In (MBI)

A Management Buy-In (MBI) is an acquisition in which an external management team purchases the target company, as opposed to the MBO where incumbent managers buy their own company. MBIs carry higher execution risk (incoming managers discover the business from the outside) but bring fresh strategic vision and new competencies. In financial structuring, MBIs use the same tools as MBOs: acquisition holding (NewCo), senior debt, and a management package aligning incentives over the hold period.

‍

Example: a team of three logistics sector managers conducts an MBI on a Swiss transport SME valued at CHF 12.0 million. The incoming team contributes CHF 1.2 million equity, a fund co-invests CHF 2.4 million and CHF 8.4 million of senior debt is raised. Their value creation plan focuses on digitalising operations and geographic expansion — development axes the outgoing team had not pursued.

‍

Hectelion supports MBI teams in target valuation, financing structuring and the business plan preparation required to engage institutional co-investors.