Protecting $17.5M in incentives across a multi-state acquisition
An acquirer's targets carried incentive packages across a dozen states and complex ownership. Prosody confirmed compliance, secured transferability, and preserved ~$17.5M in benefits — deal closed early and under budget.
At a glance
An acquirer engaged Prosody Consulting to review multiple potential acquisition targets that came with existing economic-development incentive packages — facilities spread across a dozen Midwestern states, owned through a tangle of passthrough and corporate (tax) blocker entities, on and offshore. The question behind the deal: would those incentives survive the transaction, or quietly evaporate at close?
Prosody confirmed the packages were sound, secured their transferability, and helped allocate the risk in the deal terms. All incentives were preserved — roughly $17.5 million in benefits — the tax authorities issued no-action letters, and the transaction closed ahead of schedule and under budget.
The challenge
Incentive packages are deal value, but they don’t automatically follow an asset through a sale. Each program has its own rules on continuation after a change of control, and a defect — substantive or procedural — discovered after close can erase the benefit. Across a dozen states and a complex ownership structure, that’s a lot of places for value to leak.
What Prosody did
Audited the existing programs. Prosody reviewed project-specific documentation to confirm the existing programs had been properly followed and carried no substantive or procedural defects.
Tested transferability. Prosody reviewed each program’s laws, rules, and regulations to determine whether the acquirer could continue participation after the transaction.
Worked the authorities. Prosody managed multi-state, multi-program outreach to economic-development officials to confirm understanding, document the required course of action, and finalize pre-transaction preparedness.
Allocated the risk in the deal. Prosody advised on deal terms to properly allocate incentive risk between the parties, documented each jurisdiction’s needs, and ran the workstream to secure all of it.
The outcome
Every acquired project retained all incentives it held before the acquisition — about $17.5 million in benefits — and the tax authorities provided no-action letters documenting the agreements. The transaction closed ahead of time and under budget, with the incentive value intact rather than at risk.
Why it matters
For acquirers and the private-equity firms behind them, incentives are real deal value that’s easy to lose in diligence. The work is knowing where that value hides, confirming it survives the deal, and writing the protection into the terms — exactly the integration risk where transactions quietly leak money.
That is the standard Prosody brings to every project: find the capital that fits, protect the value that’s there, and run it to close.
Prosody Consulting advises acquirers and private-equity sponsors on incentive diligence, transferability, and M&A integration. To discuss your project, request a consultation.