XPX New York - Recapitalization as an Alternative to Selling

Business owners commonly face a dilemma of whether to hold on to their business, continuing to enjoy its financial rewards and the sense of fulfillment and purpose it gives, or cashing in to secure their future and lower their risk profile. Oftentimes, a need for liquidity, either for oneself or for a passive shareholder, may drive the owner to sell before he or she is ready. Adding to the anxiety, the question of when to sell can arouse all sorts of fears that had been suppressed or ignored over the years, such as:

• What will I do with myself after the sale?
  
• Will I have enough proceeds to support my lifestyle and philanthropic objectives?
  
• Will the market for companies in my industry get even better than it is now?
  
• And for some, will my being around the house jeopardize my marital status?
  

There is a path that a surprising number of entrepreneurs are not aware of, one that lies in that middle zone and lets them keep the cake while taking an outsized slice for themselves – a partial recapitalization. Rather than agonize over whether they are selling too soon, owners should give serious consideration to a recap because it allows them to continue to own and control their company while still addressing any liquidity needs or securing their personal finances.

Our Speaker:

Margaret Isa Butler is a partner in Ice Miller's Business Group, concentrating her practice on mergers and acquisitions, joint ventures and alternative investments, including real estate development projects, limited partner investments across the investment strategy spectrum, debt and equity co-investments and direct investments by institutional investors and family offices. Prior to joining Ice Miller, Margaret was a partner in an international law firm where she oversaw mergers and acquisitions of publicly traded companies, engaged in buy-side and sell-side representation in private transactions, provided advice with respect to activist hedge fund investment techniques and related securities law issues and represented pension plans on fund investments.

Margaret received her juris doctor and Master of Business Administration through the joint degree program at Columbia Business School and Columbia Law School in 2002. Margaret was a James Kent Scholar and served as senior editor of the Columbia Law Review.