Pictured above: Andy Kay, Corporate Finance Director at Crowe Clark Whitehill

VIAMBO deals are indeed gathering pace, according to national audit, tax and advisory firm Crowe Clark Whitehill.

Andy Kay, corporate finance director at the firm's Midlands offices in Kidderminster and Walsall, confirmed that owners were increasingly using the method - Vendor Initiated Assisted Management Buy Out - to exit their businesses.

"We have used the model successfully before," said Mr Kay.

"There are many different structures but they typically involve a cash payment, loan notes or deferred consideration payments, and possibly a small minority stake going forward.

"The attraction is that it reduces reliance on securing third party funding at a time when it is very tight.

"Often owners are selling to the teams that have been running the business successfully anyway. Potential drawbacks include the limited cash element of proceeds and the risks involved in future underperformance faced by the exiting owners.

"However it can involve interest payments on loan notes/deferred consideration at better than deposit rates and owners may be able to secure the outstanding consideration on the company's assets as first ranking charge holder.

"The need for extensive warranties and indemnities is diluted, which assists owners if they are not as close to the business as they used to be. And ten per cent Entrepreneur's Relief makes such a deal an attractive proposition if correctly structured"

Mr Kay said the eventual exit price under VIAMBO should still be at "a reasonable multiple of profits".

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