Flying Together

Flying Spares’ Journey to Employee Ownership

About Flying Spares

Formed in 1995 by Ben and Lucy Handford, Flying Spares is a midlands-based company supplying new, used, and reconditioned parts for post-war Rolls-Royce and Bentley motorcars. Reflecting the passion of its founders, this business caters to a niche market and does so well, having grown to the point of offering unrivalled choice on spare parts for every Rolls-Royce and Bentley model built since 1946.

A labour of love, even when it was time for founders Ben and Lucy to move on from ownership of the company, they wanted to do so with care. They achieved this in February 2020, when Flying Spares converted to an employee ownership structure through the use of an Employee Ownership Trust (EOT).

Why an Employee Ownership Trust?

After twenty-five years at the helm of Flying Spares, Ben and Lucy decided to formulate an exit strategy for their eventual retirement. Succession planning can be difficult for any business owners to discuss, given the work and sacrifice that has gone into creating the business. This was no different for the Handfords, who started planning for their long-term future around five years prior to conversion.

The pair considered a number of different routes, including a management buy-out, passing the business on to their children, and selling to a third party. However, there was no appetite for a management buy-out at the time, and they decided that family ownership was not the right fit. Whilst selling the business seemed the most straightforward option, the couple were aware that this might result in the relocation and/or restructuring of Flying Spares, which could jeopardise the futures of their committed team, not to mention the business they had worked so hard to create over the last 25 years. They were adamant that Flying Spares shouldn’t compromise on the quality of their parts or the service they offer their customers, nor the ethos and structure they had created.

Conversion to employee ownership allowed them to avoid these dangers, as well as preventing the upheaval of their teams’ lives. In fact, rather than pulling the rug out from under their employees’ feet, an EOT allowed the company to give back to them, whilst also giving Ben and Lucy the exit plan they were ready for.

Working with BHW Solicitors, planning an EOT strategy offered the Handfords a timetable that was suitable for them whilst ensuring that what they had created would be preserved. Through the Employee Ownership Trust, Flying Spares’ employees could benefit directly from the business’ success, as well as becoming more involved in its operations. It protected the business from the changes that might come from a third party, instead giving agency to the team that had been a part of the journey with them.

On their reasoning for choosing employee ownership, Ben and Lucy said:

“We love the company we have built, but after 25 years, it was time for us to step away. However, we wanted to know that our company would last, and in the way that our team knows and loves it. An EOT was the best way to forge a secure, positive way forward for both us and Flying Spares – we can’t wait to see what they do next!”

How does it work? – A tailored approach

BHW worked with Ben and Lucy in an advisory yet practical role, creating a detailed plan to navigate the conversion process. We took a considered approach, keeping Flying Spares’ employees and the business’ future at the heart of our decision-making whilst also delivering on Ben and Lucy’s exit strategy and expectations. 

Under the new employee-owned structure, 100% of the shares in Flying Spares were transferred to an EOT for the benefit of Flying Spares’ employees. The purchase price for the shares will be repaid from the profits of the business over the seven years following completion of the transfer. This provides the company’s founders with their needs, whilst allowing the employees of the business to thrive along with the growing business.

Flying Spares’ EOT used a corporate trustee to hold the shares on its behalf (a trust cannot hold the shares itself, as it has no legal personality). The board of directors of the corporate trustee will work alongside Flying Spares’ board of directors to oversee strategy and growth of the business, with an emphasis on ensuring that the business’ ethos and values continue.

“Our thanks to BHW for all of your help in the EOT transition process. We couldn’t be happier with the service and support we received, or the outcomes we’ve reached. Thank you, Ed, Cameron, and everyone else at the team!”

An EOT can provide the best outcomes for everyone, but it needs to be drafted and navigated in the right way. An expert advisor can support your business’ conversion to employee ownership, leaving a legacy in place that does justice to your hard work.

If you would like to discuss your own EOT conversion and sale, contact Ed or Cameron at BHW Solicitors today.