Planning the Transition into Retirement

For the past two years, we have been working with a client on the best way to move on from their business. We went over every possible scenario. The most popular strategy involved letting family members take over the business gradually. After working through the issues, it was clear that this wasn't the wisest course of action.

We then focused on creating a company that would enable the transfer of corporate goodwill to a new owner. That is, a buyer who was aware that they would purchase recurring profits due to the business rather than the business owner. This allowed for a sale price closure 4 times EBIT after directors’ salaries. While this all sounds like advisor speak, what this meant for the client is in this environment, they could retire (the wife) and semi-retire (the husband) and in collaboration with their financial advisor are financially comfortable in retirement. 

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