Martin Jinks
Office Night Left Pane

Complex Partnership Restructure

Objective

To protect assets from potential changes in circumstances so that future generations can benefit.

Background

A long established farming partnership had assets valued at approximately £30m which included numerous agricultural interests. The partners realised they were potentially exposed should unforeseen issues arise, such as the death of one of them. From a financial perspective, the estate had a number of borrowings to consider, which exposed all of their assets to potential risk.

Solution

The complex work was led by our Corporate and Commercial team, who first spent time talking to the partners to identify their objectives - the main priority being to keep the business together down the next generations. Having established the objectives, the team set about the restructure. Firstly a new partnership was formed which was partly owned by a trust. This protected the assets whilst control was retained by the original partners. The trading business was then moved into a limited liability company which was, similarly, partly owned by a trust. This resulted in a separate set-up that could, if required, be sold as a separate entity without the threat of that sale affecting core assets. At the same time, and in conjunction with the clients’ accountants, the finances were restructured so that the trading company held most of the borrowings,again, protecting the core farm assets.