Falco Construction owner Brendan Griffin, who set up the business in 2004, has sold it to an employee ownership trust (EOT).
Many of Falco’s 27 full-time staff have been with the firm throughout its development and the transition to employee ownership was ‘the logical next step’, according to Brendan Griffin.
“The creation of an EOT enables us to preserve the legacy of the Falco brand and maintain its status as an established partner for utility providers well into the future,” he said. “This development safeguards the future of Falco for the benefit of its future leaders and employees and acknowledges their contribution to the company’s development and gives all employees an opportunity to share in its continued success, since by creating an ownership culture we can more effectively incentivise and accelerate growth.”
Brendan Griffin will sit on the employee ownership trust board and continue as managing director.
Falco Construction is a tier-one framework contractor for UK Power Networks (UKPN) and Thames Water. It has work on Crossrail, Thames Tideway and the Battersea Power Station redevelopment as well as providing day-to-day programmes of installations, maintenance and repairs of utility infrastructure.
In the year to 31st March 2020, it turned over £12.4m (2109: £15.8m) and made a pre-tax profit of £1.4m (2019: £2.4m).
As our article here explains, business owners exiting by selling to an EOT are exempt from paying capital gains tax. It has therefore become an increasingly popular route. Other companies that have been sold, either wholly or partially, to employee ownership trusts since the abolition of CGT on such transactions include Clifford Devlin, McGee Group, Triton Construction, Tonic Construction and Horizon Platforms.
Others, such as consulting engineers Mott MacDonald, Arup and Black & Veatch, have been employee owned since long before the Cameron government introduced incentives in 2014.
“By aligning the interests of the business and its employees Falco will benefit from greater staff engagement and commitment which can only strengthen the company’s performance which will hopefully provide the platform for continued long-term sustainable growth,” Brendan Griffin said.