19 Feb 2026
By Findlay Anderson, Partner, Head of Corporate, Gilson Gray
For some business owners, succession does not involve passing the business to family members. Instead, they may choose to sell, merge, transition to employee ownership, or gradually step away from day‑to‑day responsibilities.
Exit strategies in practice
Each option carries significant legal, tax, and commercial considerations. Common exit strategies include:
Here we look at each one in more detail.
Trade sale to a third-party buyer
A trade sale involves selling the business to an external purchaser – often a competitor, supplier, or investor – seeking strategic growth. It can deliver a clean exit and strong valuation, but requires careful preparation, due diligence, and negotiation to secure favourable terms.
Management buyout (MBO) or management buy-in (MBI)
In an MBO, the existing management team purchases the business, ensuring continuity and preserving culture. An MBI brings in an external team to take control. Both options rely on robust financing arrangements and clear legal structuring to protect all parties.
Employee Ownership Trust (EOT) transition
Transitioning to an EOT allows employees to collectively own the business through a trust, often delivering significant tax advantages and promoting long-term stability. It suits owners wishing to preserve culture and reward their workforce while stepping back from day-to-day control.
Merger or acquisition
A merger or acquisition can unlock growth, efficiencies, or new markets, while giving owners a route to exit or reduce involvement. These transactions are complex and require careful legal, financial, and cultural alignment to ensure long-term success.
Phased retirement while retaining partial ownership
A phased retirement allows an owner to step back gradually, reduce responsibility, and transfer leadership over time while retaining some equity. This option provides continuity for the business and flexibility for the owner but must be supported by clear governance and succession frameworks.
Preparing for an exit typically involves improving governance, strengthening financial reporting, and reducing reliance on the founder. A proactive approach can increase business value and make the company more attractive to potential buyers or management teams.
Gilson Gray provides expert guidance at every stage of the exit process. Our Corporate team negotiates transaction terms, conducts due diligence, and prepares all necessary legal documents. For EOTs, our lawyers advise on compliance, tax benefits, governance structures, and employee communication plans. Where founders prefer phased retirement, we design transitional roles and shareholder arrangements that protect their interests.
Our Employment, Commercial, and Dispute Resolution teams work together to ensure a smooth transition and minimise operational disruption. Whether you are selling your business or stepping back gradually, Gilson Gray helps you secure a financially and professionally rewarding exit.
