Entreprenuer Joel Block has a message for public companies: The costs of Sarbanes-Oxley have made privatization increasingly attractive to investors. In fact, he says the privatization of major U.S. companies is perhaps "the most profound economic shift in the U.S." in a decade.
As the trend grows, investment firms, bankers and the CEOs who can do the job that private equity wants them to do (make a profit) stand to benefit. With profit as the primary goal, however, Block says employee benefits and even positions will be subject to cuts.
He presents the changing atmosphere as a prime opportunity for associations and speakers' bureaus to educate employees on surviving privatization by becoming self-reliant.
We point it out here as a reminder: If you are considering taking your company private or are in the process of making the transition, don't leave employees who will be affected by the changes hanging out to dry. Educate them on what is happening and how they can prepare for those changes.