Shareholder Protection
Businesses, both large and small, face a crisis when a business owner falls ill or dies. Losing a key member of the team will cause problems across the business, especially with lenders, suppliers and clients. These problems will only be exacerbated if an external individual, without the necessary experience or enthusiasm for the business, inherits a significant shareholding.
Shareholder or Partnership Protection enables the business to continue trading after such an unfortunate event by providing the remaining business owners and partners with capital. This capital can then be used to buy out the outstanding shares, ensuring that the business remains in the hands of those that will drive it, and that the family of the unfortunate business owner receives the full value of their interest.
This type of protection is suitable for either the Partners in a business of any size or the Shareholders of a Private Limited company. The amount of cover will reflect the value of each owner's share in the business. This is a proportion of the capital value of the business, plus the goodwill included in the accounts, plus any undistributed profits, plus the individual's loan or partnership account. The value of the business should normally be assessed professionally.
PK Group's team can work with you, and your business partners, to advise on the type of protection that would be most suitable for your business. Further to this we can recommend the agreements that you may require to complement your Articles of Association or Partnership Agreement, in order to avoid Inheritance Tax issues and unnecessary disputes.
For an initial consultation; please contact your PK Advisor.
If you have not worked with us before, please contact us and one of our specialists will be able to assist you immediately.
