Total consideration payable: undisclosed
Project duration: 6 months
Flair Rugs was created by Dinesh and Rekha Shah in 1982 and has grown to be one of the largest privately owned suppliers of rugs to the UK retail channel. In 2006, the founders' son, Neel, joined the business to become MD - since which time the business has maintained its successful development and growth, and is looking forward to an exciting future. In anticipation of Dinesh’s retirement and estate planning, it was agreed that the ownership of the business needed to pass to the next generation. The challenge was now to structure and finance the transaction in such a way that was fair to both generations and to the business.
After reviewing the business and the roles of family members in the past, present and future, Marcus designed a transaction structure to allow current equity value to be understood and crystalised—with future equity value reflecting the efforts of the next generation of family management. The transaction was implemented in the most tax-effective manner, working closely with the company’s accountants and taking into consideration many factors, including inheritance and estate planning.
With the new structure in place, the founders were able to plan effectively for the future with their underlying value now secure. Under Neel’s leadership, the business is able to invest further in the future and to plan and implement a number of longer-term initiatives, confident in the rewards to come.
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