3 employees are setting up a company to purchase 100% of the shares in a trading company from the current owner.
The deal will be funded partly by a loan from the bank to newco, partly by funds held in the trading co and then the balance (around 50%) through a loan agreement between current owner and newco. This loan will be repayable over a 3 year period.
Presumably this arrangement won't affect the current owners eligibility for entrepreneurs relief? He understands that the capital gain will be chargeable in the first year.