SmithBucklin Corp. has new owners—more than 300 of them, in fact.
Recently, employees at the Chicago-based association management company purchased the company from financial investors through an employee stock ownership plan. SmithBucklin counts more than 185 organizations as clients, including several in the meetings industry, such as the Society of Incentive and Travel Executives, the Professional Convention Management Association, and ICPA, an Association of Insurance and Financial Services Conference Planners.
"It’s really been a dream to have ownership in the hands of our people," says Henry Givray, chief executive officer of SmithBucklin. "It’s our people who are creating the success and growth of our company; therefore they should have the benefit and opportunity to experience the fulfillment of ownership."
Through the ESOP, shares of the company are purchased by employees through their respective 401K plans. Of the 500 or so employees who were eligible to buy shares, 66 percent did. And of that 66 percent, the average employee owner invested 60 percent of their 401K plan in the company. Since 2002, the majority owners of SmithBucklin have been two financial investors, Svoboda, Collins LLC and Mesirow Financial. Givray approached them earlier this year about the ESOP deal and the owners were receptive to the idea, as the fast-growing company had met the owners’ business objectives, explains Givray.
With more 300 owners, there is no majority shareholder of the company. The 13-member executive team owns about 30 percent of the company, says Givray. When an employee leaves the company for any reason, their shares are offered to new employees.
The new ownership structure does not have any effect on the day-to-day management of the company. "In fact, this event reinforces and strengthens the core philosophy and values of our company," he says. Coming off a record year in 2004 in terms of revenue generation, SmithBucklin is having another strong year and is poised to generate more income this year than last, he adds.