ESOP Transaction Support
Facilitating an ESOP transaction involves multiple entities.
An ESOP transaction involves multiple parties, and we've outlined these below. Legacy Press Ventures helps to select the best partners, manage the ESOP transaction process, and advocate for you on your behalf for valuation, as well as ensure a smooth transaction.
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Law Firm
Represents the sellers and is retained to prepare the ESOP 1042 transaction.
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Trustee
A law firm / lawyer is retained to represent employees and advocate on their behalf.
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Valuation Firm
A third party valuation firm will be retained to perform an independent valuation, and our company will work with you to prepare the required financial documents to support valuation, which will include our optimized financials for strength of valuation.
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Legacy Press Ventures
Lastly, an investment banking firm is typically retained to oversee all partners, raise debt (if a leveraged ESOP transaction is used), and support the entire flow of the transaction.
For support with an ESOP transaction, we first need to know if your company can support an ESOP. Complete our "Can you ESOP today?" form for more information.
ESOP transactions begin with an initial valuation, and it is often helpful to be able to get an estimate of company value to assess if the sale represents a financial picture for selling shareholders that is adequate to then pursue a transaction.  Once this is formulated, a deal memo is created that proposes sale terms, and a negotiation will begin.  The transaction generally follows this type of process:

1.  Initial ESOP assessment:  This includes a valuation appraisal of the business, a forecast of future potential and performance, a cultural feasibility study to determine if the ESOP will fit the company's culture, and an outline of what the transaction could look like.

2.  ESOP transaction:  Assuming the assessment looks good, a formal transaction is pursued.  Closing can take anywhere from 30-90 days, depending on how pre-negotiated everything is.

3.  Post-ESOP phase:  The first year of operating a full or partially employee owned business contains some adjustments, and this phase walks through that.