Acquiring an ESOP Owned Company

by a searcher from University of Pennsylvania - The Wharton School

5 years ago

Has anyone encountered a target that is ESOP owned, or can anyone comment on what acquiring an ESOP owned company would look like? I met a founder/owner who is retiring, and is gradually moving his ownership to employees in an ESOP model. I'm interested in the company, but unsure how the ESOP structure may hinder my efforts to acquire. Advice appreciated!

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12 comments

searcher from Harvard University - Harvard Business School

Acquiring an ESOP isn't like buying a regular business. It's like buying a business with hundreds of mini-owners, a tax twist, and a complex valuation puzzle. Agree with Jeff; expect exorbitant fees

11 months ago | like reply | 0 likes

investor from New York University

A client of mine did this. He educated himself and was able to quarterback the deal. He negotiated fixed fees for the legal work, valuation, etc. The total cost was only about $50,000.

5 years ago | like reply | 0 likes

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