ESOP Transaction Feasibility Study
An ESOP is a powerful and flexible succession planning tool that enables shareholders of closely held companies to achieve liquidity while transferring stock to management and employees in a very tax efficient manner. Understanding the size, structure and financing terms of a proposed ESOP are paramount to achieving a successful transaction for the selling shareholder(s), the sponsoring company and the ESOP.
Brereton-Hanley can help provide clarity and direction to this process by conducting a thorough ESOP feasibility study that analyzes different ESOP transaction structures and illustrates the advantages, disadvantages and limitations of each. Structuring an ESOP requires knowledge in a unique combination of fields, including valuation, banking, tax law, regulatory compliance under ERISA and more. The process a transaction takes can be very dynamic. Our team of professionals has the experience and depth-of-
knowledge necessary to help you navigate through the most challenging issues to ensure a successful transaction.
An ESOP feasibility study illustrates what impact various transaction structures have on the selling shareholder(s), the sponsoring company and the ESOP. It is important to consider how each ESOP transaction impacts the company’s debt borrowing capacity and future cash flows, in addition to how it changes ongoing employee benefit levels. Our ESOP feasibility study will ultimately be used as both a strong decision making tool and as a structural blueprint for the parties and advisors to the transaction.
Mergers and Acquisition Advisory
The scope of our assignments varies depending on the goals of each business owner. In the past, Brereton-Hanley mandates have ranged from resolving closely-held and family business succession issues through complete divestitures to providing business owners with liquidity, growth capital/acquisitions or estate diversification through minority or majority equity recapitalizations.
Whatever the situation, the first thing we do is listen. We listen to the history of your business and to your unique goals. Only then do we create an effective strategy designed to maximize the value of your business, whether that ultimately means some form of a merger or not. Then, we execute against the plan.
If some form of a business combination seems to be the optimal solution, we will guide you through the proven Brereton-Hanley Process®. Our professionals will work closely with you from preparing and positioning your business to sell all the way through final negotiations and closing.
ESOP Advisory
An ESOP is a powerful and flexible business succession tool fraught with misconceptions. Many accountants, attorneys and other professionals are surprised at the level of misconceptions once they fully understand the structure. Our professionals customize the structure of our ESOP solutions to your specific goals and objectives. We also arrange the financing necessary to complete your transaction, “quarter-backing” the transaction team from start to finish. In addition to initial ESOP transactions and related transaction feasibility studies, we also specialize in servicing the unique needs of mature ESOP-owned companies. We conduct repurchase liability studies, advise on leveraged redemptions, and
assist ESOP-owned companies with growth acquisitions and divestiture strategies (selling the ESOP-owned company to strategic buyers and Private Equity firms).
Corporate Finance
Through our extensive relationships and experience, Brereton-Hanley is fully enabled to assist your company in raising private financing in the form of debt or equity. We have an intimate knowledge of and relationships with a variety of private equity and mezzanine finance groups, which seek investments in middle-market companies. We also maintain active relationships with institutional investors, major venture capital and investment funds, foreign investors seeking equity investments in the U.S., regional and money-center commercial banks, insurance companies, pension funds, and companies seeking joint ventures. These sources provide capital ranging from equity and equity-linked instruments, to subordinated and senior debt, to lease financing and off-balance sheet financing. Our experience with these firms and understanding of their investment objectives, areas of interest, and transaction processes often enable us to quickly deliver multiple financing alternatives to you on highly attractive terms.
Valuation and Fairness Opinions
We provide a full range of valuation and fairness opinions to private and public companies of all sizes and virtually all industries.
Strategic Valuation & Market Assessment
Our Strategic Valuation Opinion® is an essential business sale planning service that provides owners with an understanding of the value of their business, current market conditions and each of the exit options available. We tell you what you can really sell your business for in the current environment. Not theory or academics, but a practical, reality-based opinion based on actual transactions and insider expertise, not theory. With that information at hand, we collectively construct a list of operational action items and the top five transaction structures that are most appropriate, in terms of value maximization, given your individual situation. Because in our minds, really, what good is a business valuation if you don’t know what to do about increasing it?
