How Should Owners Cash Out Of Their Business?
October 1, 2024 – ArticleCorporate Partner, Andrew Apfelberg, authored, "How Should Owners Cash Out Of Their Business?" in Financial Advisor.
Excerpts:
Those who have run successful companies for a number of years, either as CEOs or founders, will inevitably face the question: When and how do they bow out? They might have personal aspirations to do something else, or they might think that the market conditions have made it the right time for them to leave or at least sell most of their interest in the company. Maybe they want to monetize their life’s work but keep running the company. Maybe it’s a CEO who’s been running the company alongside its founder and wants to do something else. They might want to unlock value for their company’s stakeholders by selling their shares or recapitalizing the company—or helping it go public.
But for a smooth transition, they’ll need to understand the various exit options.
This article delves into three of the most common methods for entrepreneurs ready to sell out: dividend recapitalization, private equity investment, and the sale of their company. (Sometimes, CEOs or founders will turn a company over to their employees through employee stock ownership plans, or ESOPs, though that’s less common.)
Read the full article here.
