Material Handlers turn to ESOPs for Stability

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.

Succession Planning in the Material Handling Industry

This timely conversation focuses on how closely-held companies are evaluating transaction options 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.

Hosted by The New Warehouse's Kevin Lawton, the podcast is geared toward logistics, transport, and material handling firms. Nonetheless, 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.

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Key Takeaways from the "Insights into ESOP" Podcast

Strong Industry Growth During the Pandemic

Economic and commercial trends associated with Covid-19 have benefited many material handling dealers, as well as to companies across the transport and logistics value chain. Dealers expect to maintain those gains in the months ahead.

Shareholder Demographics Driving M&A Activity

There's large a population of aging business owners who are looking to take advantage of the current window of opportunity. Liquidity events are highly coveted, but a significant portion of owners also want to maintain and grow their business legacies. There's also an industry-wide need for younger professionals to become more involved in the space.

The ESOP Alternative

Employee stock ownership plans may represent a path forward for material handlers facing an M&A crossroads. These transactions offer partial and full liquidity options for owners with notable tax and continuity advantages compared to private equity and third-party sales.

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

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