News
Insurance Firm Owner Chooses ESOP Over $230 Million Offer
Earlier this month, Philly.com reported that The Graham Company, a Philadelphia-based insurance agency (and one of the country’s 50 largest commercial agencies), made the transition to employee ownership through an ESOP. Owner William A. Graham IV revealed that he was offered up to $230 million for the company, based on its low fixed costs and strong cash flows. However, Mr. Graham acknowledged the cost of selling at a price exceeding four times the company’s revenue, as “[p]eople have to leave, for a firm to stay solvent, if it’s sold at that price.”
Instead, transferring ownership to employees through an ESOP preserves “the Graham way,” which emphasizes a commitment to investment in employees. As vice chairman Michael Mitchell observed, “Our culture does not get destroyed because someone buys us and squeezes to get another five bucks from the bottom line.”
Recent News
Disclaimer
One of the best features about our website articles and blog entries is that they are timely—you get up-to-date information on the law as it exists at the time. The downside is that the law changes, but our older entries don't. That means we can't guarantee you are getting the most current law when reading through past entries. Please don't take these articles and blog entries and rely on them as legal advice. Give us a call instead, for specific and pointed advice for your particular situation. Note that contacting us does not create an attorney-client relationship, unless you are accepted as a client of the firm.