Case studies / Access Electric Supply
Case study · Electrical distribution
Access Electric Supply sold 60% to an ESOP. The partners kept 40% and control.
One shareholder retired on a year-end deadline. The continuing partners took partial liquidity and kept running the company, with no personal guarantees.
The situation
One owner ready to retire, the others ready to keep building
Access Electric Supply was founded in 1991 in Kent, Washington. It's a nationwide electrical distributor serving commercial, industrial, government, utility, and aftermarket customers.
The company competes on technical expertise, manufacturer relationships, and creative sourcing that cuts schedule risk on complex projects, including hyperscale data centers.
One shareholder wanted to retire by year-end. The continuing partners wanted some liquidity without giving up control. They needed one structure that did both, on a compressed timeline.
Where the business sells
- Data centers. Hyperscale power distribution equipment.
- Industrial. Custom switchgear and control solutions.
- Utility and government. Substation upgrades and retrofits.
What the owners wanted
Two sets of goals, one deal
The retiring shareholder
- Full retirement by year-end
- High certainty of closing
- A fast timeline
The continuing shareholders
- Partial liquidity
- Keep 40% of the equity
- Keep operational control
- Keep the company independent
What made it hard
Four problems the deal had to solve
A lean workforce and IRS Section 415
With a small employee base, the allocations needed careful testing to meet IRS limits.
A year-end deadline
The deal had to close in a short window to meet the retiring shareholder's December 2025 deadline.
No personal guarantees
Most of the senior financing was set up without personal guarantees from the continuing owners.
C corp now, S corp later
The ESOP started in a C corporation, with a clear path to grow the employee base and convert later.
How the deal was built
The ESOP bought 60% in a leveraged transaction
A senior term loan, the majority of the structure.
About 40% seller financing, with warrants.
The continuing shareholders keep full board control.
A stock appreciation rights plan to be set up.
The alternative
ESOP vs. private equity
| Consideration | Private equity | Leveraged ESOP |
|---|---|---|
| Ownership | Majority control to the sponsor | 60% sold, 40% kept by shareholders |
| Governance | Board control shifts to the sponsor | Shareholders keep board influence |
| Liquidity | Full exit or majority recap | Partial liquidity now, a possible second stage later |
| Horizon | Defined 3 to 7 year exit | Long-term ownership |
| Employees | Potential restructuring risk | Broad-based employee ownership |
| Capital | Sponsor-driven leverage | Structured for operating flexibility |
| Guarantees | No personal guarantees | No personal guarantees |
How it came out
What the owners got
- The retiring shareholder closed on schedule in December 2025
- The continuing partners took cash out and kept 40%
- The ESOP meets IRS Section 415 rules
- Bank financing with no personal guarantees
- The company stays independent, with the same leadership
We were able to align with the Board of Directors as a truly unbiased advisor throughout the entire process and negotiate a fair outcome that suited all parties' needs.
Brandt Brereton, General Partner, Perpetuate Capital
The full case study
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What's in the PDF
- The capital structure: senior debt, seller notes, retained equity
- How the deal met IRS Section 415 with a small workforce
- The ESOP vs. private equity comparison
- The road map from C corp to S corp
- Everyone who worked on the deal
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Brandt Brereton, General Partner · +1 775-491-8357 · brandt@perpetuatecapital.com