Keeping the Farm in the Family

Agribusinesses face unique challenges and opportunities when it comes to ownership transition and estate planning. Long before one farm family faced retirement, the owners decided to pass their farming corporation intact to future generations of the family.

Working with current and second- generation family members, BKD developed a plan to “keep the farm in the family.” We did so by:

  • Converting from a C corporation to an S corporation to provide cash flow to the shareholders
  • Structuring a significant tax-free exchange of low-income producing assets to more productive assets
  • Issuing nonvoting common stock to the current stockholders
  • Gifting voting stock to future management and nonvoting stock to others
  • Forming a life insurance trust and purchasing life insurance for estate tax-free cash at death of current generation
  • Providing for a desired income stream to the current and second-generation stockholders
  • Reducing estate taxes at the current owners’ deaths

The result:  a plan that gives both generations the assurance that their goals and objectives have been met.

Business Owner Succession Will Help You...
  • Understand and plan for effects of change on your organization throughout the business life cycle
  • Address interrelationships and impacts of issues and solutions across success cycle
Our Approach Helps You…
  • Build a business with transferable value
  • Create sufficient personal liquidity and net worth to fund lifestyles
  • Tend to family needs and interests
  • Build a successor organization and plan for an orderly transition
  • Anticipate and plan for the estate tax burden
In Our Marketplace…
  • 77% of business owners have an estate plan
  • More than half of owners are over the age of 50
  • About half are contemplating retirement within the next five to 10 years
  • Nearly 70% expect to keep the business within the family for the foreseeable future
  • Only half have strategic plans
  • Only 40% have ever attended a family business seminar
  • Only 32% who plan to retire in five years have identified successors
  • Just over half have buy-sell agreements
  • If you are healthy at age 65, chances are you will live for another 20 years

Business Owner Succession

Business owner succession services is a comprehensive approach to business transition that helps you navigate through your business and personal financial life cycles.

Our team includes professionals trained in diverse disciplines to help you manage each step of the succession process and steer a path that leads to your strategic goals. Some of the questions you may address are:

  • Have you identified the critical management succession issues?
  • How will the transaction contribute to your personal financial goals and affect your lifestyle?
  • How does this transition affect your estate-planning objectives?
  • Does the business strategy and the plan drive value or personal income?
  • What will be the effect on the business before and after the transaction?
  • What are the emotional and human issues that must be considered?

In a natural business cycle, a company passes through a succession of stages from launch as a start-up to growth to plateauing as a mature, established company. At each stage the owner faces different challenges and planning needs.

Regardless as to where you are in the business cycle, changes in one area can have dramatic and immediate “waterfall” effects on other areas. Our approach allows you to understand and plan for these effects.

Business/Financial Planning

  • Strategic planning
  • Balance sheet, profitability & operating performance assessment
  • Budgeting & forecasting
  • Asset financing issues
  • Benchmarking

Personal Financing Planning

  • Cash-flow needs analysis
  • Retirement planning
  • Personal income tax planning
  • Income tax planning
  • Personal wealth planning

Management Succession Planning

  • Management skills assessment
  • Organizational development & training
  • Professional search & recruiting
  • Organization charting & position descriptions

Ownership Transition Planning

  • Business valuations
  • Acquisition positioning plans
  • Strategic research

Estate Planning

  • Tax planning
  • Gift planning & consulting
  • Documentation review & analysis

Business Succession Action Plan

  • Assess your needs & options
  • Develop timeline & define transition
  • Review & analyze your personal & business financial plan
  • Identify & plan for your family management succession issues
  • Identify & review your owner succession exit strategies
  • Review your estate tax plan
  • Address issues related to your succession plan
  • Implement action plan

For More Information

Contact your BKD advisor or:

Pat Hayes
Senior Vice President, BKD Corporate Finance, LLC
417.869.8588


Anthony Giordano
Vice President, BKD Corporate Finance, LLC
417.869.8588