It’s been over six months since we last took inventory of where we stood in the face of tax changes (increases) affecting estate planning. While we currently have some ideas on what to expect regarding the tax policy changes, the full picture remains murky. In this post, we try to clear up some of the murkiness by sharing what we are reading, listening to, and learning regarding tax changes and other factors affecting family businesses and estate plans.
Back in the spring of this year, we discussed five broad economic indicators family businesses needed to keep their eye on. In this week’s post, we wanted to revisit those trends and see where we have come over the last four months, as well as what we are hearing from our clients on the ground.
The Rise of Non-Family Equity Capital in Family Businesses
In this post, we will take a quick look at the growing supply of capital seeking minority investments in family businesses, the sources of growing demand from family businesses for such investment capital, and how directors can best position their family businesses to thrive.
Does your family business have a significant customer concentration that is reducing the valuation multiple? If so, what steps are you and your fellow directors taking to mitigate this risk? In this post, we offer two strategies to mitigate the risk of customer concentration in your business.
Family Business Director is off enjoying 4th of July festivities this week. For our readers that are looking for some beach reading, we thought we would direct your attention to some of our more popular posts in case you missed them the first time around.
Leveraged Dividend Recapitalizations and Leveraged Share Repurchases
Now is an excellent time for closely held and family business boards to consider engaging in leveraged transactions to enhance shareholder liquidity and accelerate shareholder returns. The Biden Administration has not yet increased corporate or personal tax rates and interest rates are still low. Banks are seeking quality loans and your leveraged transaction might fit their bill. And perhaps your shareholders desire some liquidity from their ownership, even if you are not ready to don’t desire to sell your company.
In this post, two corporate finance tools available to owners of closely held and family businesses are discussed at length: Leveraged Dividend Recapitalizations and Leveraged Share Repurchases. These tools can be used to create liquidity outside the ownership of private businesses or interests in them.
In this post, we offer a unique perspective from Atticus Frank, CFA who worked in his family’s business for nearly three years prior to returning to Mercer Capital and joining the team’s Family Business Advisory Group. This post focuses on the wisdom, or lack thereof, of transactions. M&A decisions shouldn’t be undertaken without understanding the meaning of the family business to the family (Is the family business a growth engine, a store of value, a wealth accumulation vehicle, or a lifestyle vehicle). Atticus tackles the topic with a story about his family business.
In this post, Travis Harms sat with Paul Hood, a recovering tax lawyer, to speak about one of the most important tasks a business owner will face: estate planning.
Cryptocurrencies, meme stocks, and NFTs are in the news. In the post, we explore what the well-publicized market activity for cryptocurrencies, meme stocks, and NFTs suggest for the value of your family business.
Over 80% of trust beneficiaries believe their trust has a negative impact on their lives. Really? That is one of the numerous counterintuitive findings presented by David C. Wells, Jr. in his new book “When Anything Is Possible: Wealth and the Art of Strategic Living.” In our family business advisory practice at Mercer Capital, we help our clients navigate the intersection of family issues and business realities. Built around the framework of wealth structure, identity, and strategy, “When Anything Is Possible” is a timely guide for business owners thinking about the role of wealth in their families.