Material Handlers turn to ESOPs for Stability (Podcast)

Material handling warehouse manager | CSG Partners

June 8, 2021 CSG Partners Staff

On the heels of his recent cover story in Material Handling Wholesaler, CSG's Nathan Perkins joined the magazine's companion podcast for a discussion on ESOPs and broader M&A trends.

Hosted by The New Warehouse's Kevin Lawton, the timely conversation focuses on how closely-held companies are formulating succession plans in anticipation of a post-pandemic business environment. Stability and legacy concerns are common among these firms. As a result, business owners seeking meaningful M&A alternatives may often turn to leveraged ESOPs for tax-advantaged liquidity.

Although the podcast is geared toward firms in the logistics, transport, and material handling industries, Perkins provides useful takeaways for business owners across all industries. If you don't have time for a complete listen, please read ahead for a brief synopsis.


Listen Now:  Insights into ESOP Podcast



Key Takeaways

  • Strong growth throughout the coronavirus pandemic was common among material handling dealers, as well as companies across the transport and logistics value chain. Dealers expect to maintain those gains in the months ahead, thanks to the continuation of various consumer and economic trends that accelerated during the pandemic.
  • Recent merger and acquisition activity among material handlers is being driven in part by shareholder demographics. There's an aging population of business owners seeking to take advantage of the current window of opportunity for liquidity events.
  • Despite this recent drive for liquidity, a significant portion of owners still want to maintain and grow their business legacies. ESOP plans may represent a path forward for these shareholders, but there's also an industry-wide need for younger professionals to become more involved in the space. The importance of supply chain businesses was front-and-center during the pandemic. Hopefully, the increased visibility will drive interest.
  • Employee stock ownership plan transactions offer partial and full liquidity options for owners, with notable tax and continuity advantages compared to private equity and third-party sales. To learn more, listen to the full podcast, or check out Perkins' article on the pros and cons of ESOPs and other M&A transactions.

Our friends at Material Handling Wholesaler and The New Warehouse have graciously made this content available to all.

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