Founded in 1974, Taylor Guitars is one of the most remarkable success stories in the world of musical instruments of the last 50 years. The company is responsible for revolutionizing manufacturing processes, pioneering the sustainable use of tonewoods, and raising the quality standard of new instruments, and Taylor has also become global leader, with manufacturing facilities at its San Diego, California headquarters and in Tecate, Mexico, its own European distribution center in the Netherlands, and an ebony sawmill operation in Cameroon. Until designer and luthier Andy Powers was brought on as a third ownership partner in 2019, Taylor was 100 percent owned by co-founders Bob Taylor and Kurt Listug. Now, the company is moving into its next phase by transitioning ownership to its employees through an Employee Stock Ownership Plan (“ESOP”).
“We have delighted in giving people the joy of music and hope to do so for generations to come,” said Bob Taylor. “Becoming 100 percent ESOP allows us to ensure our independence for the long-term future and continue to realize our vision for the company as an innovative guitar manufacturer.” Listug added, “While Bob and I are not retiring, we have been preparing for our eventual exit. Master guitar designer Andy Powers is not only the wellspring of our guitar designs for the future, but he also joined our leadership team several years ago, and strengthening our leadership team has been essential to our succession planning.”
Listug views the transition in ownership as the next step to ensure a sustainable future for the company, while also providing a valuable financial benefit to people who have contributed to its success. “We believe we’ve created a special company, where passionate people can engage in problem-solving innovation, collaboration and respect,” he said. “Securing our independence through an ESOP allows us to strengthen this culture.”
Taylor’s new ownership structure supports continuity. Taylor Guitars will serve its customers, suppliers, and broader community with the same passion and innovation it has before. Taylor, Listug, Powers and other members of Taylor’s leadership team remain committed to the company. There will be no changes to management structure, operations policies, or practices.
The ESOP is a type of tax-qualified defined contribution plan through which employees receive a retirement benefit linked to Taylor Guitars’ future equity value. Employees at Taylor’s production facility in Tecate, Baja California, Mexico, will participate in its US-based ESOP plan, and European Union employees will be participants in a similar incentive plan available under EU regulations. Taylor Guitars will be joining many other successful ESOP companies, such as Clif Bar & Company, King Arthur Flour Baking Company, and W.L. Gore & Associates, which are committed to their independence, their values, their employees, and providing the best quality, innovation and service to its customers and external partners.
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