In the News: Maintain the Culture and Say Involved in the Business/ESOPs as an Exit Strategy/On Track for Continued Growth/Strong Management-Employee Relations

Unique Home Solutions (Indianapolis, IN); Koester Cos. (Evansville, IN); Herff Jones (Indianapolis, IN); Wood-Mizer Products Inc. (Indianapolis, IN)

Employee-ownership plans increasingly common tells the ESOP story of Unique Home Solutions, an Indianapolis-based employer of 125, and cites other Indiana-based ESOP companies as examples.

Transition Plan

As the owner started planning for retirement, he knew he wasn’t just looking for the highest price. He wanted to maintain the culture he helped build and stay involved in the business. As a result, he is selling one-third of the company to the ESOP, with plans to eventually sell the rest of the company:

After all, he and his 125 employees worked hard to establish a corporate culture that has helped the service firm triple revenue in recent years—and win the Better Business Bureau's Torch Award for marketplace ethics four times…"The ultimate goal is to make [the company] completely employee-owned," said Dillon, 53. He expects to stay involved for at least 10 more years and wants to increase annual revenue from more than $18 million to $25 million by 2012.

Promoting ESOPs as an Exit Strategy

The article discusses how Indiana State Treasurer Richard Mourdock has first-hand ESOP experience that provided him the means to pursue his political career. He plans to heavily promote ESOPs as an exit strategy:

"Literally, I wouldn't be sitting here [in the treasurer's office] if it weren't for my involvement in an ESOP company," Mourdock said.

As state treasurer, Mourdock hopes to help Indiana become a leader in employee ownership plans. By the end of the month, he said, his office will roll out a "tool box" of literature to help business owners learn more about the exit strategy.

"There's a unique opportunity in the marketplace right now simply because there are so many retiring baby boomers who have the wonderful characteristic of altruism," Mourdock said, saying business owners want to repay the employees who've helped make their business.

Businesses Considering an ESOP Should Be On Track for Continued Growth and Have Strong Management-Employee Relations

The article cites Indianapolis-based Herff Jones (Indianapolis, IN), named the 2007 ESOP Company of the Year by the Indiana Chapter of The ESOP Association, as a success story. The company stresses the importance of communication, teamwork, and trust:

A successful ESOP needs "a lot of communication, some sense of history as an organization, and … some track record of success so employees are not frightened at the prospect" of owning their own company, said Mike Cheek, chief financial officer for Herff Jones. "All of those are true of our situation."

Teamwork and trust, Cheek said, also are pivotal.

"There clearly is an understanding that everyone has a part to play, and everyone is accountable for that part," he said.

The article also cites Indianapolis-based Wood-Mizer Products Inc. as “the archetype of a successful ESOP”, and stresses the importance of having a diversified retirement portfolio.