An Edinburgh firm that has designed light installations for the city’s Royal Botanic Garden is giving its staff the chance to become owners in the business.
Black Light, which began life more than 30 years ago as a mobile disco, now employs 21 people and has an annual turnover of £3 million.
Founder and managing director Gavin Stewart said: “I was looking for an exit strategy that allowed the firm to continue to grow and flourish. A sale to the employees recognises the contribution and commitment Black Light’s staff has made to the company’s success.”
An employee ownership trust will buy the shares from Stewart and hold these on behalf of the employees, who will be given the opportunity to invest in the company. The deal will be financed by a vendor loan, repayable over a five-year period.
Graham Purvis, who joined Black Light last year as general manager and will now become an employee-owner, said: “I see this as a very positive move for the business. We’re grateful to Gavin for this opportunity and it is now up to us to forge our own future.”
The company has also worked with the SSE Hydro in Glasgow and Gleneagles Hotel, and its move to employee ownership is being project managed by Carole Leslie of Ownership Associates.
She said: “Gavin Stewart is demonstrating tremendous vision in choosing this path for the business. Employee-owned companies have been proven to be more sustainably successful, with higher productivity and profitability than conventionally structured firms.”
Recent research showed there are 71 employee-owned companies in Scotland, with about 6,500 employee-owners generating a combined turnover of about £900 million.
Martyn Shaw, partner at law firm MacRoberts, said: “Employee ownership is increasingly attractive as an exit route for business owners, and can bring real benefits for the company’s staff. Recent tax changes are an incentive but for most owners the ability to secure the future of the company is a stronger driver.”
Legislation passed last year provided a tax incentive for business owners by removing capital gains tax liability on qualifying employee-ownership transactions.
Black Light is being supported in its transition to employee ownership by Co-operative Development Scotland, the arm of Scottish Enterprise that promotes collaborative business models.
Co-operative Development Scotland chief executive Sarah Deas said: “I look forward to welcoming Black Light into the growing community of thriving employee-owned firms in Scotland.”