(Indianapolis, IN) – Herff Jones, Inc. has finalized an agreement providing for a business combination with VBR Holding Corporation, the parent company of Varsity Brands, a leading provider of goods and services to the school spirit industry. Structured as a 100 percent employee-owned private company, or an “S corporation employee stock ownership plan” (S ESOP), Herff Jones credits its success to its employee-owners who operate with a vested interest in the company’s growth and development.
Founded nearly 100 years ago, Herff Jones works closely with customers to create a climate of achievement through graduation products, class rings and jewelry, yearbooks, educational publishing, and motivation and recognition tools. Varsity, based in Memphis, Tennessee, is comprised of leading organizations and brands in various cheerleading segments, including camps, clinics, competitions and uniforms.
“The union of these two companies positions us to energize and enhance the educational experience for many through our products and services,” said Joe Slaughter, CEO of Herff Jones, Inc. “This is a momentous day for the growth of our company, and it is possible because every one of our employee-owners is committed to results and customer satisfaction.”
According to a University of Pennsylvania study, S ESOP companies like Herff Jones create not only employee motivation and success, but also $14 billion in new savings and retirement security for workers that they otherwise would not have. This is because profits of the company flow into the ESOP (retirement) accounts of the workers. Moreover, most S ESOP employees have retirement account balances three to five times higher than the average 401 (k) or other defined contribution plans. This helps to explain why S ESOP owners like those at Herff Jones are so successful, as compared with most working Americans who—an April 2011 Gallup poll found—think they will lack enough money to live comfortably in retirement.
“Herff Jones is a prime example of what S corporation ESOP companies can do for their workers and for our economy,” said Greg Klein, chairman of the board of directors of the Employee-Owned S Corporations of America. “Employee-owners work smarter and harder because of their commitment and investment in the business.”
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The Employee-Owned S Corporations of America (“ESCA”) is the Washington, DC voice for employee-owned S corporations. ESCA’s exclusive mission is to preserve and protect S corporation ESOPs and the benefits they provide to the employees who own them. These companies have an important story to tell policymakers about the tremendous success of the S ESOP structure in generating long-term retirement savings for working Americans and their families. ESCA provides the vehicle and the voice for these efforts. ESCA represents employee-owners in every state in the nation.