Crafton Tull announces Employee Stock Ownership Plan
ROGERS, Ark., September 3, 2019 – Crafton Tull announced today its intent to preserve local ownership and further strengthen the company’s strong future prospects by selling the company’s stock to its employees through an Employee Stock Ownership Plan (“ESOP”). Crafton Tull becomes just the third company headquartered in Arkansas to be owned 100% by employees through an ESOP, joining Harps Foods and Central States Manufacturing.
The company employs 250 people to provide its architecture, engineering, surveying, landscape architecture, and planning services. Founded in 1963 by Bob Crafton and Lem Tull, the firm has grown to $35 million in annual revenue and serves clients in numerous states through nine offices in Arkansas and Oklahoma. Crafton Tull has always maintained an active presence in the local community. Company employees serve in numerous community leadership positions and nonprofit organizations. To celebrate its 50th anniversary five years ago, the company performed 50 Acts of Kindness in the communities where it operates, volunteering at food banks, planting trees, working in schools, and assisting various nonprofit organizations.
Crafton Tull President & CEO, Matt Crafton stated, “We realized a number of years ago that we would eventually need a plan to transfer the ownership of the business to the next generation. We and those who went before us worked long and hard to build this business, and we want to see it continue far into the future. We want our workforce and the communities that have supported us all these years to continue to do well by us in the future. With this plan, all of our current leadership will stay in place, and we’ll continue to operate and grow the company.”
Crafton Tull Chief Financial Officer, Jim Tull, added “We really needed a transition plan that worked for everyone – for our current owners, our staff, the communities we serve and of course for our clients. Transitioning ownership to the ESOP allows us to continue moving forward based on the core values that have always guided our business – integrity, respect, excellence, responsiveness, teamwork and safety.”
An ESOP is a federally regulated retirement plan that is designed to invest primarily in the shares of the parent company. Employees will receive shares of Crafton Tull stock over time, and will receive the cash value of those shares after they retire or leave the company. As is the case with most ESOPs in successful companies, the ownership transition will be funded with corporate earnings – individual employees are not investing their own funds.
There are approximately 6,500 ESOPs in the U.S., according to recent figures provided by the ESOP Association in Washington D.C. ESOP Association CEO James Bonham observed that
“Most ESOPs are in small to mid-sized firms that are very successful and that need a plan to transfer ownership to a future generation. Crafton Tull is part of a growing trend of successful businesses making the decision to pursue employee ownership to position themselves for ongoing success.”
“The most successful ESOPs combine employee ownership with effective participation, careful communications and education. Research consistently shows these companies tend to outperform their competitors in the marketplace in terms of sales growth, employee retention and other performance metrics,” Bonham said. “Not only are ESOPs beneficial for the employees and owners, but research is now showing they can be a true competitive advantage in the market.”
Mr. Crafton noted that Crafton Tull already has a number of these initiatives in place, and plans a strong communications effort to explain the new ownership changes to employees. “We are planning a series of employee communications – starting with written materials, meetings with employees and the formation of an employee owners’ committee – to explain what we’ve done, why and how it will affect everyone.” Mr. Crafton added, “We are truly thrilled with this outcome and look forward to many more years of successful operations in the communities we serve.”