Imagine you are the #CEO of a very large #manufacturing firm situated in the middle of the USA. You have hundreds of employees, and the company earns about $30 Million per year. Now, imagine that you were chosen by Congress to be a tax free entity. No Federal tax. No state tax. Pretty good fantasy, right? Save $15 Million in year one alone.
Now – here is the question I want you to think about – Do you think… believe – with all of this free cash – that you can triple earnings within 10 years? And grow this to be a $1 Billion company?
How would you go about doing it – now that you have double the cash flow – every year?
Make some targeted acquisitions? Definitely.
Increase capital expenditures? Absolutely.
Here’s the coolest part of this fairytale
It’s not a fantasy. It’s completely real. Let me explain.
When you sell your company to your employees via an #ESOP, Congress decided that the company doesn’t have to pay tax anymore. No Federal tax, and no state tax.
One other thing that you might find interesting – when an owner sells the firm to their employees, the owner pockets the proceeds from the sale gets that money capital gains tax free.
There are many more benefits too. Stay tuned.
If this idea is of interest to you, make sure to contact #DarrenGleeman at dgleeman@mboventures.com, and we can have a conversation. Our team has structured over 300 ESOPs – we know what we are doing.