Kindred MD Nick Mustoe signed a deal on Wednesday that saw 24 members of staff acquire Kindred's trade and assets from former owners Tribal Group.
Everyone at account director level and above has shares, including board directors Anastasia Scott, Ben Friend and Lorna Gozzard. It is unknown how much was paid for the agency.
Mustoe said: 'Kindred was formed from independent agencies and we are really looking forward to returning to this.
'With so many agencies being swallowed up by big networks, we believe the flexibility and freedom to innovate that we get from being independent will bring real opportunity for us and considerable benefits for clients.'
During the boom in public sector PR work, Kindred - previously called Geronimo Communications - was one of the biggest beneficiaries, boasting 120 staff in 2008.
However, its headcount dropped dramatically as public sector business dried up following the COI's freeze on using external consultants. The agency now has 68 staff.
An office move is now planned, as the agency is currently based in Tribal's premises.
The agency will also shortly be unveiling a new brand identity, while retaining the Kindred name.
In the run-up to the management buyout, 19 redundancies were made, including closure of the company's Leeds office. Mustoe said no more redundancies were planned and that the company was now debt-free and profitable.
He made a 'conservative estimate' that Kindred would make £600,000 profit in 2011.
While Kindred is best-known for its public sector specialism, Mustoe's strategy is to develop a broader client base by targeting other areas such as the voluntary sector and trade associations.