Goals
- Transitioning ownership to an EOT while keeping the legacy, purpose, and employees of the firm intact
- Keeping the business in employee hands to benefit the communities where they work
- Buying out existing shareholders while ensuring organizational continuity and long-term stability amid a broader generational transition within the company
- Supporting retiring shareholders in their exits while preserving the company’s mission, culture, and future growth
Challenges
- Ownership was concentrated among a small group of shareholders, several of whom were looking to exit. A majority stake needed to be sold within a short window to accommodate them. The sale was driven by generational change, but it also raised a harder question: how to transition ownership without losing the company's social mandate or the legacy its founders had built.
- Over time, the share price had risen to a level unattainable for current staff to afford, creating a barrier to continuing the current ownership structure.
- In addition, there were complexities involving defaulting shareholders, which had to be resolved as part of any path forward.
The Result
Taproot successfully launched Canada's largest Employee Ownership Trust, and the only one to hold 100% of shares. This success was driven by strong organizational buy-in, reinforced by clear decision-making rationale in the design process and management training that clarified the rights and benefits of employee-owners. On the financing side, the company’s real estate assets were refinanced to buy out 100% of shareholders while keeping the company stable financially, making the employees owners of the company while managing the risk of such a transaction.