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Headed for divorce? 3 options for the family business

by | Nov 20, 2017 | divorce, Firm News |

When you own high-value assets, such as a business, reaching a divorce settlement can be very complicated. For example, if you and your wife are real estate professionals that run a joint company in Delaware, you will have to decide if the two of you can continue working together or if you should sell the business. Each option comes with its own set of complications.

Before you decide on a course of action, it is best to examine the various options that are available. To find out more about some different strategies to handle the business, read further.

Keep the business going

When some people divorce, the last thing they want to do is spend any more time with their ex than necessary. However, this is not the case for everyone. If you and your future ex-wife work well together as business partners but not as a married couple, you might be able to continue operating your business together.

If you choose to go this route, the two of you keep your respective interests in the company and neither one of you will have to sell. Furthermore, you will not have to go through the tedious process of valuing the business and all of its assets. Valuation can be very expensive, depending on how complex the operations are or the kind of assets it owns.

Buy her out

Another option is to buy out your ex. This will involve hiring an appraiser to perform a valuation of the company. Once you know the value of the company, you can either offer cash for her half or an equal amount of other marital assets that you would have received as part of the settlement. If you decide that you do not want to keep the company, she would have the option of buying you out in the same manner.

Sell to a third party

If neither of you want to keep the business, you can sell it and split the proceeds. This too requires an appraiser to perform a valuation. With any luck, you will be able to sell the business fairly quickly and perhaps use your share of the proceeds to start another one. However, if it takes time to sell the company, you could wind up working with your ex longer than expected.

If you are considering divorce and you and your spouse own a business together, there are various options available for what you do with it. Be sure you examine these options so that you can decide what course of action is best for your specific circumstances.