The new management team structure comes as HLA Services changes its name to HLA Group after establishing itself as a leading provider of mechanical, heating, air conditioning, ventilation, plumbing and electrical and services – employing 130 people at it’s HQ at Boldon Business Park and satellite offices in Cumbria and a manufacturing hub in Seaham.
Eleven long-standing employees have each been given a six per cent share in the firm as company chief Paul Smith plans a “sustainable, cooperative, multi-generational, employee-focused, structure” for the firm.
Mr Smith co-founded the business in 2013 alongside Ian Rooks, Neil Henry and John Anson, and has had sole ownership for three years, and continues as managing director, with Wendy Duffy as finance director.
The new shareholders are Darren Gray, Marcus Thomson, Mark Charlton, Bruce Kirtley, Jonathan Wilson, Michael Oliver, Lee Kirby, Mark Herring, Gary Logan, Steve Grehan and Maxine Charlton.
Each receives their shares in the business – with no external funding required – and will receive an earn-out over the next five to seven years based on the company’s performance.
The firm says the shares cannot be transferred outside the business – reinforcing HLA Group’s commitment to its employees and providing internal career progression opportunities.
Paul, still remains the largest shareholder with 24% and Wendy, who has been with the business since its formation, has 10%.
The HLA Group works across the healthcare, construction, manufacturing, retail, hospitality and education sectors, including four of the North East’s five universities.
Mr Smith says he considered revamping the firm as an employee ownership trust, where all employees are equal shareholders, but the business had grown too big for that to be a viable option.
He said: “We’re moving into a new phase of our journey
“After several flattering and appealing offers by a variety of external suitors to buy the company in the past, I realised our unique brand of in-house services, which effectively made us a group of 10 internal businesses, would be a difficult fit for any acquiring company to absorb without losing the HLA brand and ethos.
“I gave a lot of thought to a very personally tax-efficient employee ownership trust, where all employees are equal shareholders.
“That model works well for a company with just a few employees where responsibility is shared equally but I believe the structure we have adopted will, ultimately, benefit all of my colleagues by incentivising the revenue creators to make sure there is plenty of work going forward for all staff.”
He added: “When myself and the original directors started the business, the only risk we faced was failure.
“It was important to me that none of the employees who have become shareholders had to finance their buy-in personally.
“The new structure incentivises them, as department heads or main revenue generators, to drive the business forward and keep it self-sustaining.”
He added: “It is my belief that by empowering our team in this way, we are creating a leadership model that reflects our core values and ensures HLA Group continues to thrive in the future.”
