Private Equity Lawyers

We have significant experience advising on management buyouts and buy-ins backed by PE funding. This includes negotiating investment agreements, structuring the equity and debt components, drafting investment/shareholders’ agreements with appropriate governance provisions, and advising management on their personal position, including sweat equity, share option arrangements, and restrictive covenant obligations.

Our MBO and MBI Services

Many PE portfolio companies pursue acquisition-led growth.

We advise on hub or spoke (bolt-on) acquisitions, ensuring that the transaction terms, warranties and integration planning align with the wider group strategy. Our Corporate team works to deliver a seamless process, often against tight deal timescales.

When the time comes to realise value, we advise PE houses and management teams on the full range of exit options. Whether it is a secondary buyout or a trade sale (or perhaps preparation for a public listing), our team manages the due diligence process, negotiates sale documentation and will co-ordinate with other advisors to deliver a smooth exit.

Getting the deal structure right is fundamental. We advise on the appropriate mix of equity, preference shares, loan notes and convertible instruments, tailored to the commercial objectives and tax position of the parties.

Our work typically includes drafting and negotiating investment agreements, articles of association, shareholders’ agreements, director service agreements, loan notes and all ancillary deal documentation.

Thorough due diligence is central to any PE transaction.

We manage the legal due diligence workstream for investors, sellers, and target companies, identifying and assessing risks across corporate, commercial, employment, property, and regulatory matters. Where issues arise, we work with you to agree on appropriate protections in the deal documentation, whether through warranties, indemnities, or adjustments to the consideration.

PE transactions almost always involve an element of debt financing.

Our Banking team works alongside our corporate lawyers to advise on senior debt facilities, mezzanine funding, revolving credit lines and the associated security packages and inter-creditor arrangements.

This integrated approach means you receive coordinated advice across every aspect of the deal.

Meet Our Banking Lawyers

Our relationship with clients does not end at completion.

We provide ongoing corporate governance support, advise on board and shareholder matters, assist with follow-on fundraising rounds and help navigate any operational legal issues that arise during the hold period.

As a full-service law firm, we can draw on specialists across employment, commercial property, IP and dispute resolution to support portfolio companies as they grow.

Private equity refers to investment capital provided by funds or institutional investors to acquire, grow or restructure businesses.

PE investors typically take a significant or controlling stake in the target company, working alongside the management team to increase the value of the business over a defined hold period before achieving an exit,  usually through a sale, secondary buyout, or IPO.

While both involve investment in private companies, venture capital typically targets earlier-stage, high-growth businesses where the risk is higher, whereas private equity generally focuses on more established, mature businesses.

PE deals often involve majority ownership and may use leverage (debt finance) to fund the acquisition, whereas VC investments tend to be minority stakes without significant borrowing.

For earlier-stage equity fundraising, including angel and venture capital investment, see Equity Investment and Company Fundraising.

A management buyout is a transaction where the existing management team of a company acquires the business, sometimes with financial backing from a private equity investor. The PE house provides the majority of the funding, a combination of equity and debt, while management invests a smaller amount to acquire a meaningful equity stake. The management team then runs the business with the aim of growing its value for a future exit.

A typical PE transaction involves several key documents:

• A share purchase agreement
• An investment/shareholders’ agreement governing the investment and ongoing relationship between investors and management
• Articles of association for the purchasing vehicle
• Director service agreements
• Warranty and disclosure documentation,
• Debt facility agreements and associated security documents
• Any inter-creditor or subordination agreements between the various lenders and investors

Timescales vary depending on the complexity of the deal, but a typical mid-market PE transaction takes between 8 and 16 weeks from heads of terms to completion.

Factors that influence the timeline include the scope of due diligence required, the number of parties involved, the complexity of the funding structure, and any regulatory approvals that may be needed (such as clearance under the National Security and Investment Act 2021).

Good leaver and bad leaver provisions are standard clauses in PE-backed investment/shareholders’ agreements and articles of association.

They determine what happens to a former founder’s shares (on a partial exit) or manager’s shares if they leave the business.

A “good leaver” (for example, someone who leaves due to ill health or retirement after an agreed period) typically receives market value for their shares.

A “bad leaver” (for example, someone who is dismissed for cause or resigns within a short period) may receive a much lower price, often the lower of cost and market value.

These provisions are important to negotiate carefully at the outset of any PE-backed transaction.