Johnson, Moore Legislation Aims to Prevent Foreign Takeovers and Closures of U.S. Businesses
The American Ownership and Resilience Act would prevent the offshoring of American businesses, strengthen domestic supply chains, and invest in American workers
Washington, D.C. – Today, U.S. Representatives Dusty Johnson (R-S.D.), Blake Moore (R-UT), Lori Trahan (D-MA), and Bill Foster (D-IL) introduced the American Ownership and Resilience Act. The bill would expand employee ownership through Employee Stock Ownership Plans (ESOPs) and provide the financing needed to keep companies in American hands—protecting jobs, preserving communities, and countering growing efforts by foreign competitors like China to acquire strategic U.S. businesses.
“American businesses are the backbone of our economy, but many are at risk of dissolving or being sold to foreign competitors like China,” said Johnson. “The American Ownership and Resilience Act will keep these companies local, strong, and American-owned. Employee ownership is a pro-worker, pro-America solution.”
“We will soon witness the greatest transfer of assets in American history as over two million U.S. business owners near retirement in the next decade. During a period of increased global competition, ESOPs serve as a valuable option to keep businesses open and American-owned,” said Moore. “The American Ownership and Resilience Act will empower and support business owners and workers who want to transition to employee ownership, building substantial livelihoods for new employee owners and protecting our domestic supply chain from hostile foreign competitors.”
“With two decades of experience in creating employee-owned businesses, we have been blessed to enjoy a front row seat to the potential of ESOPs,” said Ted Margarit, Managing Partner of Paralign Capital Partners. “We seek to establish ESOP-investing as a credible asset class for investors seeking attractive risk adjusted returns, which in turn will enable more owners to pursue employee ownership. The American Ownership and Resilience Act will be instrumental in making this a reality, benefiting employees, their families, and communities across the country. It will bolster our economy and strategic production capacity across all industries by unlocking the enhanced efficiency and productivity enabled through the alignment of stakeholders in a company’s long-term success.”
Reflecting on the transition of his family-owned business to ESOP ownership in 2024, Scott Sletten, Chief Executive Officer of JDS Industries, said, “After over 50 years in business, it was time to chart the next chapter for JDS, its 300+ employees, and the communities in which we operate. While we had numerous options from private equity and other acquirors, JDS is at its core a family business and it only seemed fitting to empower my team to pursue the future prosperity of JDS for their benefit and the betterment of all of the communities in which we operate. However, like most business owners evaluating alternatives, our ESOP and its employee-participants lacked the necessary capital to responsibly pursue an ESOP by themselves. Fortunately, we were introduced to Paralign, who provided both advisory services and a significant, aligned investment, which was only the second of its kind, that made our ESOP possible. I expect that the American Ownership and Resilience Act will support additional investment in creating more employee-owned companies, which is a boon not only for those employees, but also our country and economy as a whole as I have already seen the enhanced productivity and alignment employee ownership fosters in our business.”
“The approaching wave of generational business succession across America poses acute risks to the vitality of our industrial base. By enabling the private sector to accelerate the growth of employee ownership, the American Ownership and Resilience Act offers a bipartisan opportunity to bolster U.S. economic security and supply chain resilience while creating an additional source of retirement wealth for American workers and families,” said Jack Moriarty, Executive Director of Lafayette Square Institute.
The American Ownership and Resilience Act would:
- Enable the private sector to finance U.S. business sales to American workers through Employee Stock Ownership Plans (ESOPs), without relying on taxpayer funds.
- Equip the Department of Commerce with a zero-subsidy investment facility to facilitate these transactions.
- Support Ownership Investment Companies (OICs)—licensed private investment funds—that will help overcome the capital access barrier currently impeding ESOP sales.
The American Ownership and Resilience Act is also cosponsored by U.S. Representatives Blake Moore (R-UT), Lori Trahan (D-MA), and Bill Foster (D-IL). U.S. Senators Todd Young (R-IN), Chris Van Hollen (D-MD), Jerry Moran (R-KS), and Tammy Baldwin (R-WI) introduced companion legislation in the Senate.
Click here for bill text.
Background:
The U.S. faces an economic shift as nearly half of all privately held businesses with employees are owned by individuals nearing retirement. These firms employ over 32 million Americans, and with more than half of owners expected to retire within the next decade, the nation risks a wave of business closures or sales—many to foreign buyers. This “silver tsunami” threatens job loss, community decline, and erosion of the U.S. industrial base.
China and other strategic competitors are actively acquiring American companies, particularly in manufacturing and technology. These transactions risk moving intellectual property, production capacity, and jobs overseas, which undermines national security and weakens domestic supply chains.
Employee Stock Ownership Plans (ESOPs) offer a powerful alternative. ESOP companies are more productive, resilient in downturns, and closely aligned with local communities, especially in rural and manufacturing regions. Employees in ESOP companies accumulate significantly greater retirement savings, often more than double that of workers in traditional firms, while also gaining a meaningful voice in the business. ESOPs preserve family business legacies, promote economic equity, and keep ownership and innovation in American hands.
Despite their clear benefits, ESOP transitions face structural financing challenges. Traditional buyers offer sellers immediate liquidity, but employee ownership often requires the seller to wait 5–10 years for full payment—discouraging many from pursuing this path, even with existing tax incentives.
The American Ownership and Resilience Act aims to bridge this financing gap by activating private investment to support employee ownership. This approach offers a strategic alternative to foreign acquisition and strengthens the foundation of the American economy by investing directly in its workforce.
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