Are you thinking about succession or having management participating as a shareholder?
Usually, a management buy-out transaction is financed with a combination of debt and equity from (new) shareholders. By using an ideal level of debt shareholders can realize attractive returns. The most common (and cheapest) form of debt financing is provided by the bank, however banks do not provide unlimited financing. The remainder has to be financed by other sources. Not all situations are suited for inviting a private equity investor, as they for example require a majority stake in these types of transactions.
A mezzanine loan can offer a solution. It is a type of debt that works as capital. The principal amount is subordinated to bank financing and provides additional leverage so you as shareholders can remain in control.