How we work with clients

Preparing to hand-over the family business

The Gosh Family - five siblings with ten children between them - own a substantial food business, currently valued at around GBP320m. They have investments valued at nearly GBP200m and a variety of properties and other assets. Half of the family lives in the UK with resident non-domiciled status. The other half are still resident in their home country.

They are approaching a major intergenerational transfer but the family cannot agree on the purpose of their wealth. They also disagree on how aggressively it should be grown, how it is invested and how it should be managed.

The Gosh's goals:

• Agree a purpose of wealth and preserve family unity.
• Sell a portion of the business and invest their wealth to meet the current and future needs of all family members.
• Maximise tax efficiency.

Our recommendations:

• Family Governance and Succession team to work with all family members to resolve disputes, help to formalise their collective purpose and set up a Family Council. Stonehage Fleming Law to draw up a Family Constitution
• Law team also to work with the family to set up new structures and review existing arrangements.
• Corporate Advisory and Legal teams to advise the family and arrange for an offshore entity to acquire a portion of the business.
• Investments team to provide counsel on asset allocation, manager selection and risk management, helping the family establish a long term investment strategy.

Outcomes (to date):

• The family now meets on a regular basis which has helped to preserve harmony among all members.
• Members of our Investment Management team sit on the family’s Investment Committee. The family have invested in a portfolio of high quality global companies, advised by the Global Equity team.
• Most of the family’s offshore wealth is now held through structures, and their domestic assets are held both individually and in a family trust.
• The team works with the family on an ongoing basis to keep the family up to date on changes to RND and Inheritance Tax (IHT) rules, which would impact those with substantial property interests in the UK.

Disclaimer: Please note, all case studies have been carefully anonymised. Although scenarios are based on real life events they have been fictionalised and are an amalgamation of client experiences. All names, locations and occupations have been replaced with pseudonyms.