Barbour Publishing announced that its employees have now become owners under an Employment Stock Ownership Plan (ESOP) that took effect June 30. Timothy Martins, who bought Barbour in 2000, will continue to serve as CEO and chairman, and the management team will remain the same under complete employee ownership.
“At some point, owners of small, privately held companies need to exit the business, which means a sale of some kind,” Martins told PW. “A sale to an ESOP allows the company and its employees to continue to operate and grow the business, as compared with a sale to a competitor which almost always means a move, downsizing, and or consolidation of operations.”
Instead of that happening, all 36 Barbour employees received shares of the company automatically, without paying to participate. Martins compared the ESOP to a retirement plan that rewards employees who stay with the company long-term. “Studies have shown that the pride of ownership can significantly boost productivity and cultivate a long-term view of everyday decisions,” he said. “ESOPs, at their core, are retirement plans, so the biggest long-term benefit is realized when exiting the company at retirement age.”
Further, Martins hopes that the ESOP will attract a new generation of Barbour employees. “The long-term strategy is to focus on building an ownership culture within the organization in the coming years, and to cultivate and train the next generation of leaders,” he said.