Business Transition Planning
We Deliver on the Promise of helping you identify the value of your business so that you can make the best purchase or sales decision possible.
Are you planning to transition your business to the next generation or a new set of owners, yet not sure of what steps to take? When you envision the future transition of your business, whether to a partner, a child or through a sale, have you given thought to the compliance and reporting requirements that should be considered? The team of professionals at Skoda Minotti will guide you in your business transition plan to ensure your succession plan is not only comprehensive, but also compliant to the regulations and laws governing the transaction.
Business owners are often so busy with day-to-day operations that they may not give enough attention to what will happen to their privately-held business after they are no longer around. In addition to providing valuation services in support of estate and gift tax filings, we often consult with business owners to help them understand the value of their company so that they can begin planning how to transfer their ownership to the next generation in a cost effective manner – whether through gifting, ESOPs, a sale, or numerous other transfer strategies.
Not every valuation is driven by a “need” for compliance (tax filings, domestic relations matters, financial reporting, etc.). We are able to tailor our services to provide businesses with an indication of their value based on a number of different valuation approaches. Business owners and executives can then use this information for strategic planning purposes in order to reach their goals.
Employee Stock Ownership Plans (ESOPs)
An ESOP is a unique tool that offers business owners a way to monetize their ownership interests. Essentially, in an ESOP, a business owner sells his or her ownership interest to the company’s employees – this provides employees with an opportunity to obtain an ownership interest in the company they work for while supplying current owners with a way to harvest a portion of their illiquid investment. ESOPs draw significant IRS and Department of Labor (DOL) attention and scrutiny, especially in regard to the valuation aspects involved in ESOP administration. Since a valuation is required not only at initial set-up of an ESOP, but also on an annual basis thereafter, it is imperative that business owners align themselves with reliable valuation experts like those at Skoda Minotti.
Fairness and Solvency Opinions
Fairness and solvency opinions not only provide a board of directors with financial information to assist them in making decisions, but they also serve as factual evidence in the event of litigation, in order to demonstrate that the board used reasonable business judgment in making a decision on behalf of the company’s shareholders. When a potential transaction necessitates a company’s board of directors and management to obtain a third party opinion regarding the fairness of the transaction or the solvency of the company to the company’s shareholders, our professionals are able to efficiently perform the valuation analysis to satisfy this requirement.
Divestitures and Redemptions of Shareholder, Partner and Member Interests
In any sort of ownership transaction involving a privately-held business, the value at which the transaction will take place is often the primary concern of the parties involved. Our experienced and technically-detailed valuation experts are able to prepare valuation analyses that can withstand an attack from opposing parties – and allow you to feel confident in the determined value.
Shareholder, Partner and Member Buy-Sell Agreements
Oftentimes, buy-sell agreements will call for the use of a valuation expert in determining the value of a departing shareholder’s interest in order to facilitate the transaction. We also often consult with business owners and attorneys during the drafting of buy-sell agreements to provide guidance on valuation-related issues, as well as perform related valuation analyses.