Personalized ESOP Advisory Services
Customized ESOP Advisory Services
Since 2001, Bellview Associates has helped countless private companies throughout The United States through ownership transitions in the form of Employee Stock Ownership Plans (ESOPs).
Partner Buyouts
Many professional firms (e.g., medical practices, architecture or engineering businesses, etc.) are structured so that remaining partners purchase ownership stakes of retiring partners using personal capital, credit, and after-tax dollars. A Bellview Associates transaction can eliminate personal liability and buy out retiring partners with pre-tax dollars.
Legacy Preservation
Owners spend years building their businesses, brands, and places in the community. An ESOP helps preserve that legacy while giving owners full value for their business. When someone owns a profitable business and doesn’t have enticing buyer opportunities or doesn’t want to sell to a competitor or private equity firm, an ESOP is the best choice. In that case, Bellview Associates can tailor a transaction where owners receive fair value for their stake in the company and provide a path to employee ownership. We are experts at maneuvering family legacies so that both generations and the other employees all win.
Removing Barriers to Progress
As a company grows, so does the number of people with ownership interests. Some companies reach the challenging position of being restricted by passive or inactive owners. An ESOP pays fair value to each existing owner, consolidates ownership, and allows for company stock allocations to current employees.
Mergers and Acquisitions
Our team has merged multiple independent companies under common ownership and combined diverse companies under a single ESOP umbrella, creating tax-free entities and expense savings.
Expediting the Return on Acquisitions
Acquiring companies with an ESOP provides a tax-advantaged way to make acquisitions. The form of the transaction is situation-dependent, considering the fair value of the acquired business, any existing debt, and the relationship between the two entities and their respective leadership going forward.
Finding Liquidity in Restructuring
Owners with a stake in multiple diversified or related companies may benefit from combining them with a single ESOP transaction, especially where any or all businesses have debt. For example, a company leases its office, warehouse, or manufacturing space from a real estate business with common ownership. Combining these entities under a single ESOP creates cost efficiencies and a tax-free organization that will allow repayment of a mortgage and any other debt with pre-tax dollars.
Tailored transactions where owners receive a pre-tax, fair value payout, providing a more sound path to employee ownership.
Unique Financial Structures
Bellview frequently assists businesses with unique financial structures. For instance, we advised one of the few companies that could accomplish an SBA-financed ESOP. The volume of special rules applicable to such a transaction made the transaction.
Small Businesses
We have structured S corporation ESOPs for small companies with under ten employees. These types of S-corp ESOPS can be challenging because the rule that provides people with more than 10% of the company’s equity, when aggregated, must have less than 50%.
Employee Retention
In another instance, we designed a MedSOP strategy for physicians in states and jurisdictions where only doctors can own the shares. We have done several physician ESOPs and are happy to present an alternative to the current ‘broken’ model where a young physician shoulders the expenses of buying out the older generation. The older generation receives book value—rather than market value.
Tax-Efficient Safeguarding
At Bellview, our team understands the distortive, accretive effects of buybacks and synthetic equity ‘retirement’ and can neutralize these effects through financial modeling and plan design. By setting up distribution and diversification policies, our ESOPs manage the repurchase obligation carefully. We take the opposite view of most ESOP advisors; using ESOP shares to fund benefits and early/liberal diversification is hugely beneficial.
We have designed ways to replace tax-inefficient option/appreciation rights plans with tax-efficient ESOP benefits that can convert businesses with debt portfolios to tax-free entities. ESOPs enable companies to pay off loans with tax savings and purchase the company from the owner on behalf of employees. Our transactions safeguard the company from financial challenges through various techniques: liquidity cushions, long-duration loans, minimal interest to selling shareholders (replaced with tax-advantaged future benefits), and clawbacks.
Tailored Solutions Are Available
Over the years, our advisors have encountered various unique situations, and we have worked to find a tailored solution for each. A practical approach to a company’s restructuring, merger, or acquisition exists. If transitioning to employee ownership is an opportunity you’d like to discuss, contact our team today.
Request a consultation
CONTACT OUR TEAM
"*" indicates required fields
Send us a message:
inquiries@bellviewassociates.com