Under this new structure, all the company shares are acquired by the EOT for the benefit of its employees – allowing R&W Scott staff to participate in and influence the company’s future direction, without having to directly own or buy shares.

EOTs were introduced by the government a decade ago to encourage more shareholders to adopt this corporate structure. This form of ownership is gaining popularity – there are now over 200 employee-owned companies in Scotland – and there is strong evidence to show they perform better than other types of ownership structures.

The current leadership team bought the 144-year-old business through a management buy out (MBO) in 2018 and have delivered on their 5-year growth plan to arrest losses, safeguard employment, and achieve annual EBITDA of £2 million.

The decision to create this new structure was driven by the desire to sustain the company’s independence and recognise that R&W Scott’s success was built upon the hard work and commitment of its employees.

Clare McNeil, commercial director of R&W Scott, said: “Many businesses in our sector are acquired by larger competitors or outside investors as they grow. To safeguard employment here and continue to deliver sustainable growth, we’ve created the R&W Scott Employee Ownership Trust.

“Since we bought the business in 2018, we’ve delivered year on year growth, and our plan is to maintain that trajectory for the long-term benefit of our employees.”

Operationally R&W Scott’s senior leadership team, including Stephen Currie, managing director, Clare McNeil, commercial director, and Michael Hewitt, finance director, will continue to oversee the day-to-day operations. John Easton will exit the business but will hold a position on the trust board representing the outgoing shareholders.

R&W Scott’s management team has opted to secure external funding to speed up the EOT transition process and was introduced to specialist bank, Shawbrook by advisors, HNH Group. Shawbrook will be providing a hybrid funding facility, combining asset-based lending with a property and cashflow loan to support the acquisition from the original owners and assist with R&W Scott’s continued growth plans.

Michael Hewitt, finance director at R&W Scott, commented: “The decision to move to employee ownership feels right for our business right now and we want to make this move as seamless and effortless for everyone involved.

“Working with a funder like Shawbrook who understands the processes and requirements is central to meeting this objective.”

David Cayzer, director at Shawbrook, said: “As more and more business owners consider succession planning and retirement exits, EOTs have become a more prevalent option in the market and we have supported a wide range of organisations with funding to fast-track these transitions.

“We are delighted to be working with Michael and the team at R&W Scott with funding for their EOT and look forward to seeing the business grow as it progresses through this exciting stage of its journey.”