Majority ownership of a leading UK cleaning contractor has transferred to its 2,500 employees.
Principle Cleaning Services (PCS) was established by Douglas Cooke in 1989 and after over 30 years in charge, he and the other shareholders have decided to secure the future of the company through an Employee Ownership Trust (EOT).
EOTs were introduced to encourage employee ownership by allowing business owners to sell all or a majority of their shares to an EOT.
Law firm DMH Stallard project managed both the corporate restructure and banking aspects of the transactions from a legal perspective guiding the directors and NEDs through the corporate and banking processes and liaising closely with Deloitte (tax), Corbett Keeling (CF) as well as the off-shore professional trustees and their advisors.
The project involved a twofold transaction timetable in which first the EOT was established and second in which the EOT secured financing from one of the UK’s ‘big four’ banks to support the transaction.
Danos Athanasi, partner at DMH Stallard, led a team of corporate and banking lawyers (which included Mark Diamond, Chris Gleeson, Sarah Naylor and Ahmed Butt). He said:
“Having worked on a number of EOT transactions, it was a pleasure to be instructed on this project, knowing that some of the employees have loyally served within Principle Cleaning Services for over 25 years. It is incredibly heartening to play a part in another transaction that will see the employees have a share in the future prosperity of the business. We were delighted to bring in our banking colleagues to support Principle on the financing and to conclude the transaction.
The shareholders and board can be incredibly proud of what they have built and the fact that this transaction preserves the legacy of the company founded by Douglas over 30 years ago.”
David Hoskins, CFO and Shareholder at PCS, said:
“As a director and a shareholder, I was very grateful for the support, knowledge and guidance Danos, Sarah and their teams at DMH provided throughout the EOT and financing transaction process. We certainly benefitted from the close working relationship Danos has developed with Corbett Keeling over a number of years and his connections with off-shore professional trustees. Having brought one chapter to a close in the history of PCS, we now very much look forward to working within this new EOT structure and to maximising the future growth of PCS and the potential return to the employees as beneficiaries of the EOT.”
