In 1991, Superior Electric was formed as a Subchapter S corporation to pursue electrical work in the automotive industry based in the Midwest. After 25 successful years in business, the company needed to deal with succession planning since the existing owner was nearing retirement age. Therefore, after investigating the options available, on January 1, 2015, Superior became a 100% employee-owned company. This was accomplished through the implementation of an Employee Stock Ownership Plan (ESOP).
An ESOP is a sale of a company by the current owner to the employees. It is a form of recapitalization that is sanctioned by the Federal Government as a legitimate process to transfer ownership from the original owners to their employees on a tax-preferred basis. The ESOP is also a retirement plan that allows employees to invest in the future of their company with their retirement savings in lieu of other investment options.
ESOPs are governed by the Employee Retirement Income Security Act (ERISA), United States Department of Labor.
An ESOP has many advantages. Although ownership changed, day to day management of Superior Electric remained the same. This made this a seamless transition for vendors and customers. We continue to operate Superior just as we did in the past.
An ESOP also provides several competitive advantages, allowing us to better serve our customers at a lower cost. And Superior’s employee/owners are highly motivated to provide the best service possible to customers.
Superior’s employee/owners receive ongoing education regarding ESOPs and the status of Superior Electric. Additionally, select employees attend seminars and conferences throughout the year. They exchange information with other ESOP companies and stay current with the topics and climate of the ESOP world.
If you would like more information about ESOPs, we recommend the following sites:
The ESOP Association www.esopassociation.org
The National Center for Employee Ownership www.nceo.org