How can an owner take cash out of the company without selling it?
In brief. An owner can take value out of the company without giving up control in four main ways: a dividend recapitalisation, an owner buy-out (OBO), a loan secured on the owner's shares, and a sale and leaseback of operating real estate. The right choice depends on the company's borrowing capacity, how much control the owner is willing to share, and where the owner is tax resident.
The four routes compared
| Route | Who borrows? | Control | Typical amount | Watch out for |
|---|---|---|---|---|
| Dividend recapitalisation | The company | Kept in full | Depends on debt capacity, often 2 to 3.5 times EBITDA in total | Dividend is taxed; the company is more fragile |
| Owner buy-out | A holding company | Kept, sometimes with a minority fund | Commonly 50 to 70 % of the value | 5 to 7 years of debt service; substance of the structure |
| Share-backed lending | The owner | Kept in full | 15 to 40 % of value for private shares | Margin calls if the value falls |
| Sale and leaseback | No one: the building is sold | Kept in full | Up to the building's value | Rent payable for 15 to 20 years |
A worked example
A company earns EUR 10 m of EBITDA, carries EUR 5 m of debt and owns its plant, worth EUR 20 m. It could borrow about EUR 30 m (3 times EBITDA) and pay a EUR 25 m special dividend; sell the plant for EUR 20 m and lease it back; or run an owner buy-out in which the owner receives 70 % of the value and keeps the majority of the holding. The three do not have the same cost, tax treatment or risk if trading slows.
Questions to settle before choosing
- How much can the company repay without cutting investment, even in a downside case?
- Will the owner accept a shareholder alongside him, even a minority one?
- Where is the owner tax resident, and what will the cash be used for: spending, reinvesting, passing on?
- What do the shareholders' agreement, existing loan documents and articles allow?
Tax in broad terms
In France, dividends and capital gains are taxed at the 31.4 % flat rate from 2026, unless the shares were first contributed to a holding company. In the United Arab Emirates there is no personal income tax. A loan is not taxable in itself. Every structure should be confirmed by a tax adviser before it is carried out.
Our role
We model these options on the company's real accounts, test them against a downside case and prepare the file for the banks, lawyers and tax advisers. Big4PM places no securities and takes no commission on the financing chosen.
Facing a decision like this?
We read every request personally and reply within 72 working hours when we believe we can be useful. The first review is free and without commitment.
Request a reviewSources
This guide is general information. It is not investment, legal or tax advice. The rules quoted must be checked by your advisers before any decision.