M&A Advisor Tip: F-reorganization

/in , /by Al Statz

Deal structure can have a big impact on your after-tax proceeds. The right structure can help you retain more of the sale price. For example, an F-reorg is a tax efficient method that allows you (the seller) to rollover equity into the buyer’s new entity without paying taxes on the rollover amount.

Without using an F-reorg, you might sell 100% of the company and get taxed on that full amount (ouch!) before reinvesting some of your proceeds in the buyer’s new business.

For advice on exit planning or selling a business, contact Al Statz, CEO of Exit Strategies Group, Inc., at alstatz@exitstrategiesgroup.com. Exit Strategies Group is a partner in the Cornerstone International Alliance.