Selling to an ESOP Enables a Business Owner to Sell In 60-90 Days

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In our discussion on how Selling to an ESOP Creates an Internal Market and Built-In Buyer I mentioned how an ESOP transaction can be closed in as soon as 60-90 days.  While a more realistic time frame is three to six months, a properly planned straightforward ESOP transaction can take place in 60-90 days if the seller is committed to selling to an ESOP and is willing and able to respond quickly and make timely decisions.  A tight deadline will make it that much more important to have assembled a competent and experienced team of ESOP experts to close the deal.  The ESOP consultant that will be coordinating the ESOP implementation efforts will need ESOP expertise and strong time and project management skills to keep the transaction moving forward on schedule.  If timing is a concern and there is not enough time to complete the ESOP transaction by the desired deadline, there are ways to structure a transaction so the company and business owner are able to maximize the financial benefits while a deal is being finalized.

If you are comparing your business transition alternatives, you should contrast this with the timing to sell to a third party.  Preparing a company to sell on the market could take three to six months all by itself.  The sale itself could take six months to two years or longer.

Our series on Selling to an ESOP explores many of the benefits of selling to an ESOP:

• Selling to an ESOP in 2012 Increases After-Tax Proceeds by 43%

• Selling to an ESOP Pays for Itself

• Selling to an ESOP Provides a 15%+ Expected Rate of Return

• Selling to an ESOP Provides Full Payment at Fair Market Value

• Selling to an ESOP Provides Additional Value for the Seller

• Selling to an ESOP Increases Cash Flow by Eliminating Income Taxes

• Selling to an ESOP Enables a Business Owner to Defer/Avoid Taxation

• Selling to an ESOP Enables a Business Owner to Sell In 60-90 Days

• Selling to an ESOP Creates an Internal Market and Built-In Buyer

• Selling to an ESOP Enables a Business Owner to Sell While Retaining Control of the Company

• Selling to an ESOP Provides a Business Owner with Liquidity and Diversification

• Selling to an ESOP Provides Greater Employment Stability and Increases Job Satisfaction

• Selling to an ESOP Saves Local Jobs and Strengthens the Local Community

• Selling to an ESOP Rewards Loyal Employees & Preserves Company Legacy