Inside M&A - May/June 2009

Advantages of Using ESOPs to Structure Acquisitions and Divestitures in an Uncertain Economy

New York Cases Involving S Corporations

Pre-Packaged Sales in Administration in the United Kingdom

New Belgian Law on Business Reorganization Takes Effect

Distressing Times Pose Special Risks for PE (Mergers & Acquisitions)

Intelligent Risk-Taking (The Deal)

Advantages of Using ESOPs to Structure Acquisitions and Divestitures in an Uncertain Economy
By William W. Merten

For years, employee stock ownership plans (ESOPs) have provided both a ready exit strategy for privately held business owners and a platform for management buyouts. More recently, M&A advisors have used leveraged ESOPs to accomplish both conventional stock and asset acquisitions and divestitures (including spin-offs of divisions or companies (e.g., failed "roll-up" companies). They have also been used by venture capital and private equity firms (collectively, private equity groups) as