Pritchett Controls Converting to employee ownership: A Case Study
What is it about?
Approximately 20 years ago, Jerry Pritchett, one of the co-founders of Pritchett Controls (PC) started questioning the future direction of the company once he retired. He had concerns about selling the company and the perpetuation of what PC had established. History had shown that many companies “fail” due to cash and other resources being drained by new owners when sold. He began to investigate other ways to exit the company without selling it to a large company. This led him to learn about Employee Stock Ownership Plans (ESOPs). He elaborated, “I like the idea of rewarding the employees, the people that made it successful. It seemed to make sense, and it gave us a future progression that I liked. In fact, it would be under the control of the people that got us there in the first place.” This led Jerry to convert PC to an employee-owned company in 2007 through an ESOP. Before that happened there were a few twists and turns.
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