It is important to know that your company is still in good hands once it has been handed over. As part of the cooperative financial network, mutual respect and a long-term outlook are part of our DNA.
With 50 years’ experience as an equity investor, we know that a hand-over needs to be carefully prepared. This is why we are available to give support and guidance right from the start of your deliberations but we can also help in the planning of unprepared company successions.
There is no standard approach to company succession. We can give you the flexibility to first sell just a minority holding, to stay at the helm despite selling or to install a successor from within the family in a few years’ time.
Finding a successor within the family, preferably a daughter or son, is still the ideal scenario for most German entrepreneurs. However, it only works out in a fraction of the cases. Very often, the next generation has other plans, is too young or does not have the necessary qualifications. At least in the last two instances, it is sometimes possible to find a solution. Ask a person you trust - preferably a friend or confidant with no aspirations to become the successor and who is not part of the family - to make their own assessment. Some weaknesses that you see as exclusion criteria can perhaps be overcome with professional coaching - or may seem less serious to an outsider. And if the successor is not quite ready, there are tried and tested interim solutions: a manager from outside the family but who knows the company well could continue to run the business and take the planned successor under their wing. It is also possible to structure equity and mezzanine financing in such a way that the departing senior family member can receive their pay out without delay and their successor can slowly take up the investment.
Management buyouts - whereby an existing manager (or team of managers) not only takes over the running of the company but also becomes a shareholder - are almost as common as solutions involving successors from within the family. The manager needs neither to be sitting on a vast fortune nor to incur excessive debt in order to be able to pay you an appropriate purchase price. In most cases, management acquires a minority stake while the majority holding is purchased by an equity investor (or financial investor or private-equity company) such as VR Equitypartner, which gives management a large degree of operational freedom. If the equity investor wants to exit after several years and the company has developed successfully during that time, the management is often able to increase its shareholding.
There is nobody from within your family or the company who can be your successor? This is not an uncommon scenario these days - but equity investors often have access to a comprehensive network of experienced executives with the relevant know-how. A shareholding at preferential conditions provides the management with a strong incentive to work for the long-term success of the company. In other cases, only short-term management solutions are needed, for example for the implementation of an investment project. In such instances, equity investors like to rely on interim managers, who then withdraw - perhaps making way for a successor from within the family or the company.
In this instance you sell your company to an equity investor - and remain a shareholder yourself by acquiring shares in the acquisition vehicle set up by the equity investor for the purpose of purchasing your company. The clear advantage for you: You can realize some of the sales proceeds immediately and diversify your assets and, at the same time, finance the purchase of company shares with the help of debt and/or mezzanine financing, therefore using less equity capital. This enables you to keep benefiting from the positive development of your company while uncoupling the operational succession from the shareholder succession.
Another form of company succession: Selling to another company, usually a competitor or a company in the same sector. However, this form of succession is not always popular because the sale to a competitor can mean the loss of your company’s identity. Very often it also heralds changes to the corporate culture, and the elimination of duplicate structures can lead to job losses.
It sounds obvious but it is underestimated time and again: A successful succession process needs careful planning. You should allow at least five years for this. Not only do you need to take aspects of corporate law into consideration but also operational issues associated with the succession. Often, the difficulty with such a long planning horizon is not to neglect the preparations in the face of urgent day-to-day business. It is also important to involve the relevant persons from early on while also ensuring your succession plans do not become public knowledge.
From Münster central railway station:
About 10 minutes by taxi.
Public transport offers various options from the central railway station. Either take the bus line 7 direction Kriegerweg, the number 15 bus line direction Albachten, or the bus line 16 direction Mecklenbeck. The bus station is „DZ Hyp/IHK“ whichever route you take. From here, cross the Weseler Strasse, and the Sentmaringer Weg is diagonally opposite. Immediately left is VR Equitypartner GmbH located.
Coming from the A1 and A43, at the Münster-Süd motorway junction take the B51 and then the B219 (Weseler Strasse) in the direction of Münster city centre. After the second major junction, turn off after just 400 m on the right into the Sentmaringer Weg. VR Equitypartner GmbH can be found immediately on the left.
VR Equitypartner GmbH
Platz der Republik
60265 Frankfurt am Main
Platz der Republik 6
Entrance via Friedrich-Ebert-Anlage
From Frankfurt Airport:
Take the A5 towards Frankfurt to Westkreuz Frankfurt. Follow signs towards Frankfurter Westkreuz and Messe. From there, drive into Friedrich-Ebert-Anlage and follow the arrows on the map.
Parking is available in the public car park “Westend” in Savignystraße.
On request, we are happy to reserve one of our visitor parking spaces in Cityhaus I for you.
The entrance is in Erlenstraße.
With public transport:
Take S-Bahn line S8 or S9 (towards Frankfurt Hbf., Offenbach or Hanau) and you will arrive directly at the main station (Hauptbahnhof).
U-Bahn line U4 or U5 – Station Frankfurt(Main) Hbf.
It then takes around 5 minutes on foot from the station to VR Equitypartner.
Tram lines 11, 16, 17, 21 – Platz der Republik stop.