There’s another 24 employee owners in the Highlands and Islands as Caley Timber moves to employee ownership. Caley Timber and Building Supplies was established by Donald John Morrison in 2003, and with depots in Inverness and Uist has become one of the most trusted and respected building industry suppliers in the Highlands and Islands.
Now with Donald John opting for retirement he has rejected an open sale of the business, which would have undoubtedly achieved a higher-value price, and with his wife and co-owner Jennifer Morrison decided in favour of entering into an Employee Ownership Trust (EOT).
The move means there will be no disruption to normal business, and that the company will be placed under the stewardship of its 24 staff, with Ewan Urquhart, who has been with the company since its inception, promoted to the Board as Director. Alistair Sim remains a Director and will assume more responsibilities as Donald John reduces his time with the company.
Owners Donald John and Jennifer Morrison cited several reasons for choosing the EOT route in favour of a traditional sale and described the process as “seamless”.
He said: “An EOT was a less intrusive option and we did not have to share sensitive information with prospective purchasers, the timing has been controlled to suit the business, and it also avoided the risk of unsettling our staff who may have picked up that the business was for sale.”
“We value the relationships we have built with our customers, their loyalty and support are what’s made Caley Timber the very successful business it has become, and an EOT means business simply continues as is. I am confident our customers will notice absolutely no difference at all to the quality of service.”
The Caley Timber founder also revealed the EOT process removed any “guilt” that he may have experienced by selling to a third-party, and potential uncertainty that would have been introduced to the business.
The price was also right. “It may have been that if we had gone on the open market and a bidding war had ensued that I could have achieved a higher price, but this might not have been in the best interests of the business or its employees going forward,” said Donald John.
“I feel that shareholders have received a fair return on their investment, I am confident this is the right choice, and I feel very positive about Caley Timber’s future.”
The idea of the EOT solution was introduced by Donald Forsyth of the firm’s accountants, Saffery Champness. Donald Forsyth says, “A sale to an EOT is proving to be a popular option for Highland business owners. Caley Timber is an excellent example of a flourishing company serving the Highlands and Islands and the EOT has secured the future of the business as a locally owned company.” Donald Forsyth joins the Caley Board as Non-Executive Director.
Legal advice was provided by Harper Macleod. Partner Chris Kerr says, “Caley Timber is a great business. It was a privilege to support Donald and the team on this next stage of the company’s journey.”
News of the transition has been welcomed by staff and Archie McVicar, who manages the firm’s Benbecula site, said: “The news was a surprise, but a good one. Donald John has always done the company proud and we were wondering what would happen when he planned his retirement. This is a very generous gesture by Donald John and Jennifer and good news for us all.”
Donald added: “The employees embraced the idea wholeheartedly and grasped immediately that this was good news for them. I’m now even more convinced that the move to an EOT is a good one for the Caley team and for our customers, and I believe many businesses in the Highlands would also have taken this route had they been aware of it.”
A curious coincidence is that EOT legislation was first introduced in 2014 by former MP for Inverness, Nairn, Badenoch and Strathspey and ex-Chief Secretary to the Treasury Danny Alexander, who like Donald has strong connections with Uist.