Shakespeare advises on weight loss firm’s staff deal

THE COMPANY behind the Cambridge Diet has been bought by its employees in a deal advised by Shakespeare Putsman.

Gary Davie, a corporate partner at the Birmingham law firm, with Jonathan Hall of HDI Capital Partners and Lisa Stevenson of Parisi Tax, helped weight management business Cambridge Weight Plan (CWP) to begin transferring ownership of the company to its staff.

The move has been achieved through the creation of an Employee Benefit Trust – the Cambridge Trust – and is designed to secure an independent future for the company.

The Cambridge Trust has purchased shares from the company funded by loans and contributions from Cambridge Nutritional Foods, the Northants-based parent company of Cambridge Manufacturing Company. Trustees include the current shareholders, Gary Davie, and an employee representative. More shares will be purchased in the future.

Owners Eileen Skinner, Rob Thompson and John White say they want to ensure that the company is run in the long term best interests of its employees and that it maintains the core values and ethos built up over the last five years since Eileen, Rob and John undertook a successful management buy-out of the company.

In five years turnover has increased from £5.6m to £28..

CMC Managing Director Eileen Skinner said: “Cambridge Weight Plan is an unusual company because we are one of a very few direct selling businesses that both manufactures and sells its own products.

“As we plan for the future and consider what would happen if any of the owners wanted to exit the business, we realised that our unusual role as both manufacturer and retailer could lead to a risk of the break-up of CMC which would threaten the security of our direct employees, our consultants in the UK and the operations of our distributors overseas.

“The three of us have spent a combined total of more than 60 years with the company, building a strong unique ethos and culture and we couldn’t let that happen. We therefore asked for advice on the options initially from Shakespeare Putsman and then from the team including HDI Capital and Parisi Tax and have chosen to sell our shares to the Cambridge Trust, even though this is unlikely to be the most financially advantageous option for us.”

The transfer of shares will take place in two stages with the first phase – representing 49% of shares – having just been completed. The intention is that the Cambridge Trust will look to use its funds in a number of ways to benefit employees. These could include enhancing performance related pay and pension provision.

Shakespeare Putsman’s corporate team, headed by Gary Davie, advised on the change in ownership structure and also advised the management team on the original management-buy-out in 2005. Mr Davie will also serve as a trustee of the Cambridge Trust going forward. HDI Capital Partners and Parisi tax also advised and funding was provided by Lloyds Banking Group (Milton Keynes).