Workshop Family Firms 25 June 2012
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Transcript of Workshop Family Firms 25 June 2012
Questions?#MFMFF
Succession of the Family Firm: ell-it-on, Pass-it-on or have it managed for you?
B l J 25th 2012Brussels, June 25th, 2012
MFM Alumni partner:
AgendaQuestions?
#MFMFF
Civil and legal aspects of successionJean-Philippe Bonte, Head of Wealth and Analysis Planning at ING
Investing in (the transfer of) family firmsWalter Beyen Partner at Vectis ParticipatiesWalter Beyen, Partner at Vectis Participaties
Conflict prevention & mediationHanne Van Waeyenberge, Expert in family business mediation
Transfer in family owned companiesTransfer in family owned companiesKarel Boone, Lotus Bakeries
ModeratorMiguel Meuleman, Assistant Professor at Vlerick Leuven Gent ManagementMiguel Meuleman, Assistant Professor at Vlerick Leuven Gent Management School
Reception
MFM Alumni partner:
Questions?#MFMFF
Civil and legal aspects of successionJean-Philippe Bonte, Head of Wealth and Analysis Planning at ING
MFM Alumni partner:
Questions?#MFMFF
Investing in (the transfer of) family firmsWalter Beyen, Partner at Vectis Participaties
MFM Alumni partner:
INVESTING ININVESTING IN(THE TRANSFER OF)
FAMILY FIRMSFAMILY FIRMS
VISION OF A FINANCIAL INVESTOR
WHO IS VECTIS PARTICIPATIES ?
Independent investment fund (EUR 35 million)
I i 2004 i (Fl i h) SME’Invests since 2004 in (Flemish) SME’s
Investment tickets between EUR 0,25 and 3 million (minority stakes)
Provides operational support (interim CFO)Provides operational support (interim CFO)
Investors: Gimv, institutional investors and ± 40 Flemish entrepreneurs
Various investment options:pMBO / MBI / OBO transactions (a.o. succession issues, exit of the family, …)Growth financingStarters with experienced management
Investment amounts between EUR 0,25 and 3 million (minority stakes)
Currently 9 participations in family firms
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OPERATIONAL SUPPORT
DirectorDiscuss strategic issuesDiscuss strategic issuesMonitor strategy implementation
(Interim) CFOSounding board for management;Implement (analytical) financial reporting;Legal support & assistance with HR related matters;Point of contact for banks and insurance companies;
&Prepare and monitor budgets & business plans;“Independent” mediator in case of tensions/discussions between operational shareholders.
Bridging the period in which the company is not able to attract a fulltime CFO
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CHARACTERISTICS OF INVESTEMENTSIN FAMILY FIRMSIN FAMILY FIRMS
The decision to sell the company is often an impulsive/emotional decisionThe decision to sell the company is often an impulsive/emotional decision
A family firm is usually not (optimally) structured to attract an external partner/acquirer
Family firms usually have a “thin” management structure
Sale of the company could be initiated by (fiscal) wealth planning
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ALTERNATIVE FOR 100% SALE : THE “OWNER BUY OUT”
Sale of the family business to an acquisition vehicle (“Newco”)Newco acquires 100% of the shares of the family firm
Capital of Newco is contributed by private equity, family and management
Balance of transaction price : bank financing (2 – 2,5 x EBITDA) and vendor loans
Benefits of an “OBO” for family shareholdersDiversification of family wealth
Financial investor provide strategic advice for further growth
Family entrepreneur stays CEO
Financial investor and CEO join forces to establish a professional management teamFinancial investor and CEO join forces to establish a professional management team
Financial investor exits in 5 to 7 years
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i i i iVectis ParticipatiesStratem 11 bus 2Stratem 11 bus 2
9880 AalterPhone 09/375.69.00
[email protected] www.vectisparticipaties.be
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Questions?#MFMFF
Conflict prevention & mediationHanne Van Waeyenberge, Expert in family business mediation
MFM Alumni partner:
C fli t ti di tiConflict prevention & mediation
Succession of the family firmVlerick MFM Al mniVlerick MFM Alumni
ING, Brussels, June 25th 2012
Hanne Van WaeyenbergeExpert in family business mediationExpert in family business mediation
www.inderminne.com
in der minneweer minnenmeer winnen
“I t t ll f il fi ”“I want to sell our family firm”
in der minneweer minnenmeer winnen
“I t t ll f il fi ”“I want to sell our family firm”
… was only a cry for mutual understanding.
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A CONFLICT PREVENTION (3 messages)A. CONFLICT PREVENTION (3 messages)B. THE POWER OF MEDIATION
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A. CONFLICT PREVENTION1 M t th f di f ili1. Message to the founding families
“The succession of a family business is a long term
psychological procespsychological proces.
The emotional and relational aspects are of more importance
i ( fi i fi )then all technical aspects (legal, financial, fiscal).”
in der minneweer minnenmeer winnen
“ l t h l i l ”“a long term psychological proces”A proceeding in stages:A proceeding in stages:
Phase 1: Preparation: am I (& are we) ready for succession?
Phase 2: Decision making: we choose Phase 2: Decision making: we choose • to sell• an external manager controlled by the family• succession by family
Phase 3: Elaboration: legal, financial, fiscal arrangements
Phase 4: Implementation: selling / leaving / introducing / …
in der minneweer minnenmeer winnen
“ l t h l i l ”“a long term psychological proces”
in der minneweer minnenmeer winnen
“ l t h l i l ”“a long term psychological proces”
in der minneweer minnenmeer winnen
“ l t h l i l ”“a long term psychological proces”
Start in time
Take your time Take your time
in der minneweer minnenmeer winnen
“the emotional and relational aspects”
Letting go is difficult for:
the family business-leader !
the family
the company
Tips:
take your timetake your time
focus on your mental well-being
in der minneweer minnenmeer winnen
“the emotional and relational aspects”
The earnings of the sale will not compensate
the loss of identity or status the loss of identity or status.
Distance yourself mentally from the business
before the sale!
in der minneweer minnenmeer winnen
“the emotional and relational aspects” Acknowledge, name and take care of g ,
emotions + needsCommunicate about it by yourself within the family in your communication with the potential investor
Tips:
seek assistance of a facilitator seek assistance of a facilitator
choose only an investor who fits with your needs
in der minneweer minnenmeer winnen
i d th li flmind the calimero-reflex
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i d tt ib ti b h imind attribution behaviour
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2 M t th t l i t2. Message to the external investors
the legal owner the psychological owner
Th h l i l The psychological owner has control intimately know the firm invests himself into the project is seen as the major representative
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Mi d th d f th Mind the syndrome of the conqueror
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3 M t th t l 3. Message to the external manager
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B THE POWER OF MEDIATIONB. THE POWER OF MEDIATION
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Th d t f di tiThe advantages of mediation Short termShort term informal & fast procedure low cost a consensual solution based on needs
SOLUTION
a consensual solution based on needs
Long term relationship (trust, comprehension, respect)p ( , p , p ) (self) empathy quality of communication
TRANS-FORMATION
Mediation empowers!
in der minneweer minnenmeer winnen
Questions?#MFMFF
Vision of the entrepreneurKarel Boone, Lotus Bakeries
MFM Alumni partner:
Questions?#MFMFF
Q&A
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Thank you for your attention
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