Our team offers site selection expertise and identifies often overlooked incentive value to firm portfolios or target companies ready to relocate, expand, make capital investments, or add new jobs. Given the volume of new acquisitions, ongoing capital investment, and hiring that can occur each year and necessity for speed through deals, our team maintains an ongoing dialogue with our private equity partners to help firms meet long-term goals.
What are Economic Development Credits and Incentives?
To attract and retain growing businesses, state and local governments provide valuable economic incentives, which include tax abatements, payroll tax credits, infrastructure grants, low- or no-interest loans, training grants, and tax increment financing. These state and local incentives provide many opportunities for private equity firms to increase cash flow and value of portfolio companies.
How We Support Private Equity Firms
- Due diligence: evaluating the target companies’ existing incentives to determine carry-over applicability, requirements, and associated risks
- Determining if transactions will create opportunities for new credits and incentives
- Incentive analysis for facility consolidation/relocation, CAPEX/PP&E and workforce expansion/relocation
- Site selection
When Should Portfolio Companies Pursue Incentives?
- Adding 15 or more jobs over five years
- Buying, leasing, expanding or building a facility
- Purchasing $1 million or more in new equipment
- Acquiring or merging with another business
- Relocating operations
The following case studies demonstrate how McGuire Sponsel helps increase value and reduce costs for portfolio companies.
Peak Rock Capital/Pretzels, Inc.
Site selection and approximately $15 million in incentives to assist with a facility expansion, new equipment, and projected job growth
Compass Group Equity Partners/Tipton Mills
More than $675,000 in payroll tax credits, training grants, and property tax abatement on a planned facility expansion
- Review (transactions, purchases, relocations, expansions, etc.)
- Assess (we provide recommendations including value estimates. We provide location based information on taxes, workforce, operational costs and more that will help you make great decisions)
- Obtain Incentives (we go to work for you, maximizing value at your direction)
- Report (internal and external stakeholders receive management reports documenting value and driving great decisions)
Partner with Us
Partnering with us is a no-risk decision. We get paid when we create value.
McGuire Sponsel’s Credits and Incentives team partners with private equity firms to maximize location-based incentives. Our firm has strong experience evaluating opportunities on an individual company basis and implementing a comprehensive strategy to ensure all portfolio companies are maximizing incentive opportunities. Contact us and we will help you identify hidden value from potential incentives.
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