Phacil employees buyout founders, create ESOP
As 2016 came to a close, Phacil, a mid-sized Arlington, Va., IT contractor took a big step in its development.
The company founders sold their stake in the company to an employee stock ownership plan, creating a 100 percent employee-owned company. The company has about $140 million in annual revenue.
Terms of the transaction were not disclosed, but the deal allowed founders Sascha Mornell and Rafael Collado to exit the company while Phacil continues on as an independent entity.
The current senior leadership led by executive chairman and CEO Tom Shoemaker will continue in place.
“The ESOP success formula is simple: Employee-owners make great employees. Employee-owners know that their efforts can help them gain a benefit that is greater than just their salary,” Shoemaker said.
The company’s day-to-day operations will not change. “With the ESOP, Phacil remains the same,” said Mehdi Cherqaoui, execucutive vice president and chief financial officer. “The primary difference is that the company stock is now held by a trust on behalf of Phacil employees.”
The McLean Group served as an advisor on the deal.
In a blog posting to employees, Shoemaker touted the benefits of being an ESOP.
“It is a long-term plan, which rewards Phacilians for remaining with the company and growing it over time,” he wrote. “The longer employees remain with Phacil, the longer they will be able to create value for themselves and their families.”
The ESOP basically acts as type of retirement plan where the plan owns stock in the company and employees vest over time.
He also quoted statistics from the National Center for Employee Ownership and esopinfo.org showing that ESOP companies are generally more profitable and provide a greater return to employees than traditional retirement plans.
The company founders have not been involved in daily operations at Phacil for several years, a company spokesman said. The transaction allows them to invest in other opportunities.
Phacil was founded in 2001 and provides software services, systems engineering, integration and operations, cybersecurity and service desk. The company holds contract such as GSA Alliant, Schedule 70, ITSS-4, FBI IT Triple S, DHS Eagle II, Navy Seaport-e, and the Patent and Trademark Office’s Software Development & Integration Next Generation contract.
According to USAspending.gov, the company had $122.1 million in prime contracts in fiscal 2016, and some of its biggest customers included the Defense Department, GSA, Homeland Security Department and the National Science Foundation.
Posted by Nick Wakeman on Jan 10, 2017 at 12:40 PM