MBO when one half not willing

[Adviceplease123456]

Hello, I was wondering if anyone has any advice on what happens in the following situation and who could offer legal advice:

Potential management buy out in small limited company.

One director (A) owns 50%, other director (B) owns 50%, but legally splits 25/25 with his wife (C) I assume for tax purposes.

A no longer wishes to work with B due to differences of opinion on how business should be run. No partnership agreement in place or anything official etc.

A has got professional valuation and offered that for the 50% but B/C outright reject it and don’t wish to sell.

A wants to therefore leave and start up on her own and wishes to understand her options and legalities of these.

this isn’t for me but a good friend and so I’d like to be able to point her towards some resources or advice anyone has. It’s all got very emotional and stressful.

Firstly just to comment on B/C splitting the income, if the shares are in B’s name then the income is all B’s and they are committing tax evasion to declare it any other way. There is no legal way to split this income unless B has gifted their shares and really they are held 50:25:25.

Back to your question. To extract themselves A should first of all resign as a director and stop working for the company. Then if B still doesn’t want to buy them out, A can hang on to the shareholding and continue to collect dividends. A is in the strong position here, it would be most strange if B wouldn’t want to buy them out.

A needs proper legal advice