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Grady-White Boats founder declines $400 million sale, pledges profits
The CEO is turning his company into a purpose trust structure where voting rights are separated from the company’s money, and all profits will go to healthcare, conservation, and education causes he supports.
A wealthy boat builder is declining to sell Grady-White Boats for $400 million, choosing instead to route the company’s profits to charity-oriented causes rather than taking a payday, the New York Times reported via Yahoo Finance.
In an interview, Eddie Smith Jr., the company’s CEO, said he considered selling after getting to the stage of receiving offers, but worried a new owner would cut back on the company’s employee benefits and culture.
Yahoo Finance reported that Smith plans to step down from his active role while using a purpose trust, a steward-ownership arrangement in which a company’s voting rights are separated from its money. The trust has no beneficiaries, is overseen by committees that appoint trustees, and is generally expected to operate according to the founder’s wishes.
The story also notes that purpose trusts are non-charitable trusts and have grown in popularity, rising to 81 companies from five in 2018, according to consultancy Purpose Owned, with Patagonia’s 2022 announcement cited as a factor in that trend.