How it started

Moorcrofts was instructed to advise the shareholders of a specialist cyber security firm on the exit of a majority shareholder under the company’s mandatory share transfer provisions. With the firm providing highly sensitive services, including cyber and privacy risk management, security architecture and assessment, and subject matter expertise, there were important legal, structural, and national security considerations involved in the transfer of ownership.

What we did

The team at Moorcrofts took a comprehensive and phased approach to support the transaction and surrounding legal matters, including:

• Managing a complex share sale: We reviewed and implemented the exit process under two separate shareholders’ agreements and the company’s articles of association. We also submitted a mandatory notification under the National Security and Investment Act 2021, given the sensitive nature of the business and the proposed transfer of control.

• Supporting share acquisition financing: Acting on the advice of the company’s accountants, we prepared the legal documentation for a company-funded loan to enable the purchaser (a director and remaining majority shareholder) to acquire the exiting shareholder’s interest.

• Addressing employee incentive implications: The transaction triggered provisions in the existing EMI option scheme. We advised on and prepared documentation to allow for partial option exercises and lapses, and are now preparing a new EMI scheme to align with the refreshed leadership structure and retain key talent.

• Corporate governance clean-up: As part of the wider restructure, we are consolidating and updating existing shareholders’ agreements, removing references to the exiting shareholder and revising the transfer provisions to better reflect the future ownership structure.

• Protecting privacy through regulatory redaction: Due to the nature of the client’s work, there was a significant concern around personal security. We used new powers under the Economic Crime and Corporate Transparency Act 2023 to redact sensitive personal information from the public record at Companies House.

How it helped our client

Moorcrofts enabled a smooth, compliant transition of ownership that preserved business continuity and aligned with both national security law and internal shareholder arrangements. Our guidance around the EMI scheme ensured staff incentives were protected during the transition, while our corporate documentation review future-proofed governance for the company’s next chapter. Importantly, we also helped protect the personal safety of the company’s leadership team by successfully removing identifiable information from public view.

Contact us

If your business is going through a shareholder change or operates in a sensitive industry where discretion and compliance are paramount, speak to our expert team.