ALLENTOWN, Pa., Jan. 8, 2020 /PRNewswire-PRWeb/ -- Through an exciting and culture enhancing transaction Andesa Services, Inc is pleased to announce their 165 employees now own 100 percent of the company, through an employee stock ownership plan (ESOP) executed by the Shareholders earlier today. An ESOP is an employee benefit plan which provides company stock to employees as part of their retirement benefit. The ESOP is in addition to Andesa's existing 401(k) retirement program.
A strong venture capital and M&A market exists in the U.S. today, particularly for technology-based companies. So, this type of transaction is unusual in the insurance technology sector. After 36 years in business, the shareholders had several alternatives to succession. However, they determined an ESOP was the best way to enhance the firm's employee-focused culture, continue alignment with its life insurance client partners, position the company for future growth and live into the Andesa Forever vision.
John Walker, Andesa's Founder and Board Member shared a video message with the new employee-owners upon completion of the ESOP transaction. "This is one of the most exciting days of my life and I hope you share my excitement. Way back when we were talking about the values of the company, the idea that the company would remain in the hands of the employees and under control of the employees was a vision we had. I am excited that we have such a great staff to turn this responsibility over to. I am excited for you and I hope you are excited for the opportunities it will provide you."
"In today's market, there are many different ways to address ownership succession," noted Ron Scheese, Andesa's President & CEO. "Most succession strategies were not the right fit for Andesa, its employees and the client relationships that we have worked so hard to build over the decades. We have strived to build a great culture and our employees have been the critical factor in that long-term success. This noteworthy moment in our history empowers us even more to preserve our vision and values by which we continue this great company journey. I am beyond excited to walk the next steps with my fellow-owners in pursuit of our Forever vision."
ESOPs were developed in the US as a mechanism to facilitate the owners of privately held businesses to transfer ownership to their employees over time in a tax efficient manner. It was set up to create a market for the shares of a departing owner or a closely held company in a way that preserves the independence of the business and protects employment in the local economy.
Andesa Services provides comprehensive, integrated policy administration, plan administration and support solutions for life insurance and annuity carriers and producers. Andesa began as a pioneer in the field of COLI/BOLI policy administration. Today more than 30 years later, Andesa's integrated approach to insurance and plan administration results in efficiency gains, reduced hardware costs, mitigated compliance risk and improved market response. The Company offers a comprehensive suite of services for policy and plan administration in a secure, private cloud environment. Andesa partners with numerous insurance companies, including 6 of the top 13 life and annuity carriers, along with several top producers. The Company's highly-experienced team of U.S.-based professionals provides insurers and producers large and small with administrative support for complex plan and product offerings.