Corporate Commentary Episode 9

When life gets in the way of a great plan!

Many businesses wait for problems to emerge, rather than anticipating them; early attention, can save a lot of aggravation and cost later. Here is some food for thought, based on real examples.

Shareholders agreements – any point?

Two brothers ran a communications business, which was growing quickly; one was considerably older than the other, but they complimented one another. Following divorce, the older brother remarried, a significantly younger woman; he then had a heart attack and died, leaving his 50% shareholding to his wife.

Short term things went well, with decisions left to the active brother, and dividends shared. The older brother's widow re married, and her new husband began to throw his weight around. The active brother's decisions, and exec remuneration were being challenged, and investment/growth were slowed down.