Beau's to begin selling ownership to employees [General]
2016 May 17
I've been thinking about this a lot today.
It may not be as altruistic as it seems, but it is probably the only way forward to stay independent.
43% of shares are from non-family early investors. 10 years on, some of those investors are probably looking to cash in, and that's pretty close to impossible with a privately owned company. This seems to me to be the only way forward that allows those early investors to cash out.
I know someone who works for a privately held company that is largely employee owned, and we did the math on exercising stock options within the company. Even with the extremely generous stock dividends that are paid out each year, it would take about 10 years to just break even on that transaction. I have no idea what sort of dividends Beaus pays.
Really in the company I looked at, the only way for the employee to make money in the short to medium term would be for the company to be bought out by a publicly traded company.
It may not be as altruistic as it seems, but it is probably the only way forward to stay independent.
43% of shares are from non-family early investors. 10 years on, some of those investors are probably looking to cash in, and that's pretty close to impossible with a privately owned company. This seems to me to be the only way forward that allows those early investors to cash out.
I know someone who works for a privately held company that is largely employee owned, and we did the math on exercising stock options within the company. Even with the extremely generous stock dividends that are paid out each year, it would take about 10 years to just break even on that transaction. I have no idea what sort of dividends Beaus pays.
Really in the company I looked at, the only way for the employee to make money in the short to medium term would be for the company to be bought out by a publicly traded company.
2016 May 17
The whole thing is light on details but big on PR. As a privately held company they do not have to disclose their financials but it would help the discussion. They must first establish a valuation for the company which would help them set a dollar value per share. This would be the price that an employee would pay to own a share in Beau's and they would buy it off an existing investor. The winner here is the original investor (and the Beau's family) if what they originally paid for their shares is much less then the new price (which it will be). As for current Beau's employees looking to buy in? It must feel good to be a part of things but financially you would have to focus on the dividend unless you want to cash in down the road by selling to a big brewery.
Andy
www.theglobeandmail.com