A Highlands hotel has become the latest Scottish business to become employee owned.

Forty six staff at The Priory Hotel in Beauly, Inverness-shire, which was founded more than four decades ago by Stuart Hutton, now own a stake in the business.

The move to employee ownership came after Hutton began looking at retirement options.

Son Kenneth, a former golf professional who has become managing director of the employee-owned business, said the hotel had been put up for sale but his father didn’t feel that the prospective buyers “were the right fit for the hotel”.

“A staff member had once mentioned employee ownership as a potential solution to this – it meant the business would be sold to those who know it best, and it wouldn’t be taken over by a large chain. The option stuck with my dad and when he felt like he had the correct management team in place, the time was right to begin progressing the buyout,” he said.

An Employee Ownership Trust has been formed which will hold 72% of the shares on behalf of the employees.

Kenneth Hutton will retain the bulk of the remaining shareholding

The transition to employee ownership,  backed by funding from Handelsbanken, was supported by Co-operative Development Scotland (CDS) and Highlands and Islands Enterprise (HIE) with the process managed by Ownership Associates, legal services by Anderson Strathern and accountancy support from Johnston Carmichael.

Sarah Deas, director at CDS, the arm of Scotland’s enterprise agencies which promotes employee ownership, said: “Stuart has spent over half his life building a successful and much-loved local business. By handing control over to a team that he knows and trusts, the hotel’s important standing in the community is protected, along with jobs and company ethos.”

Bruce Farquhar, chairman at Anderson Strathern, sees employee ownership as an attractive succession option for many Scottish businesses.  

“Many entrepreneurs don’t want to see someone else’s name over the door of the business they started.  The employee ownership option allows the former owner to get a good price for the company, and remain as involved as they want to be.  It’s proving to be an increasingly popular option," he said.

There are around 100 employee-owned companies operating in Scotland, with approximately 7,000 employee-owners generating a combined turnover of around £940million.