Why Architecture and Engineering Firms Make Great ESOP Candidates
October 1, 2011
From the article:
Government statistics estimate that approximately every eight seconds another individual born during the baby-boomer generation passes the age of 55 – one step closer to retirement. The explosion of births between the years of 1946 and 1964 in the United States has resulted in a major demographic group that is referenced consistently by trade groups and companies globally. The aging of this baby-boomer generation, combined with the gradual improvement in equity pricing multiples since the financial crisis, have recently led to an amplified interest among owners of privately held architectural and engineering (“A/E”) businesses in pursuing exit strategies. However, like many privately held businesses, A/E firms often struggle with implementing long-term succession planning strategies in connection with an owner’s exit plan. While there are several liquidity alternatives for owners of mid-size companies in the A/E industry, selling to an Employee Stock Ownership Plan (“ESOP”) can result in numerous advantages compared to others.