Glossaire

Management package

A management package is the set of economic incentive mechanisms designed to align key managers' interests with investors' in an LBO or fundraising transaction. It may combine co-investment in ordinary shares, preferred shares, BSPCEs, stock options, free shares or sweet equity. The objective is to allocate to management a share of value creation — typically 5–20% of gains — in exchange for their commitment and performance. Its structuring must respect the legal, tax and economic balance to be defensible before fiscal and judicial authorities.

Example: in a CHF 40.0 million LBO, management receives 10% of capital through a CHF 400,000 sweet equity co-investment. If the company is sold 5 years later at CHF 70.0 million, management realises approximately CHF 3.5 million in capital gains — an 8.75x return on their initial investment, tightly aligned with the fund's performance. The package is governed by bad leaver and good leaver provisions.

Hectelion structures and values management packages in LBO and fundraising transactions, optimising the economic balance between management attractiveness and investor protection.

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