Case Study: Windowmaker

Windowmaker was established in 1996 and is involved in the manufacture of PVCu products; conservatory roofs, PVCu frames, doors and patio doors. The company is based in Gloucester and has approximately 100 employees.

The owners of the business were looking to sell and wanted to guarantee both the survival of the company and continuous employment for its workforce. At the time the two were considering the traditional route of selling on the open market when their attention was drawn to an article in the media about Baxi Partnership. One of the owners contacted Baxi Partnership regarding the possibility of a management led employee buy out (MEBO).

In December 2003 the company became employee owned by means of an Employee Benefits Trust. The Employee Share Scheme was put in place with a percentage of shares being held by employees through the share scheme with the remainder held in an Employee Benefit Trust.

All employees who had more than three months service were given shares worth £1000 ? those with longer service were given shares up to the Inland Revenue maximum of £3000. In addition, the employees had the option of purchasing shares up to £3000, with purchased shares being matched by the company on a 2;1 ratio. The remainder of the £5m purchase price was funded by bank debt.

The employees elect two directors to sit on the Board, and two employees are elected as trustees. The employee directors are full board members, and participate in the briefings that follow all board meetings, known as the Friday Forum. The employee trustees, together with appointed trustees, make recommendations on the annual share allocations.

One of the previous owners remained as Managing Director for the initial period following the buy-out, but has since left the company. A Managing Director was recruited externally and has focussed on building management strength and forging strong links with customers.

Since the buy out, investment in employee development and training has increased, and different communication channels have been established. Good attendance at the Annual General Meetings demonstrates a healthy interest in company performance.