Pass It On

The question of ownership transition and succession in the engineering and construction industry is a major one. Many companies are family businesses, with family members of the current owner poised to take over. Some owners of other companies expect current senior managers to take over. However, only 37% of owners have made formal arrangements to transition out of the business. Such transition arrangements take time, and more and more owners are following a slow path, which industry consultants are calling the “lingering ownership transition.” The lingering ownership transition involves the current owner selling only a portion of the business to the next generation, and then continuing working, passing on some duties to the next generation. The seller then organizes a buy/sell or stockholders agreement that is beneficial to both the seller and the next generation. The structure of the transaction is flexible so that the seller can keep some ownership of the business, but may retire if they choose to do so. This slow transition provides stability for the company. Industry consultants expect, due to the uncertain economy and political climate, more and more business owners will begin to adopt this strategy.

Language

  • English

Media Info

  • Media Type: Print
  • Features: Figures; Photos;
  • Pagination: pp 19-23
  • Serial:

Subject/Index Terms

Filing Info

  • Accession Number: 01489405
  • Record Type: Publication
  • Files: TRIS
  • Created Date: Aug 1 2013 1:04AM