Legacy Advisors: Securing Our Lifestyle

Our clients, married and in their sixties, owned 51% of a manufacturing company in an industry with tremendous growth potential. Their four children were all active in the family business and owned the remainder of the company. Through many meetings with the clients and their children, it became clear that the goals of the family were to ensure the financial security of the parents, to raise capital for the business in order to take advantage of ripe market conditions, to keep the company private and to provide for charity. However, it was agreed that the number one goal was security for the parents and nothing could be implemented unless this objective was addressed.

Very careful analysis was done for the parents focusing on needed cash flow for them to be secure and fulfill their philanthropic goals. This analysis indicated they needed significant assets and cash flow to meet their objectives and the sale of their stock should put them in a position to begin the next phase of their lives. Ultimately, an investment banking firm was chosen to raise equity for the company. The infusion of equity was structured so that the parents received cash for their interest in the business, helping provide for their desired security. In addition, the clients were able to transition the voting control to their children so that it could continue to remain private until the children decided to move in a different direction. Legacy also helped design a strategy for the investment of the cash proceeds that lets our clients “sleep at night” knowing their lifestyle would be provided for. Stable growth and income producing investment strategies formed the core of this portfolio. For other purposes, higher growth investments and more concentrated investment strategies were selected. Working with the family as their Chief Investment Officer, Legacy was able to design an effective asset and investment plan and then identify the skilled investment firms to implement the plan.

It was the upfront planning that made this dream a reality. Our clients are enjoying life. Comfortable with their financial security and the security of their children through ownership of the company, the clients were able to make substantial gifts to several local charities and fund a private foundation, which they now run with their children.

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The sample situations shown here are illustrative only and are not indicative of future performance or success and may not be representative of the experience of other clients.