CABEL Partners works with a variety of different clients. In particular we specalise in working with Health Professionals, Not for profit organisations and in estate planning. Outlined below are a number of case studies where we can show you what role we play with different clients.
CASE STUDY: Shareholder Sale and Structure Change
Client: Long standing Sydney based Medical Practice.
A shareholder of the Medical Practice decided to sell their interest in the practice.
The Role of CABEL Partners
Phillip Browne was asked to take on the project management of changes to shareholder’s ownership in the business. We acted for the business and vendor, and the purchaser had independent advisers. This involved:
- a valuation of the business
- Discussing the financial, structural and tax implications with the shareholders
- Discussing loan funding
- Preparing long term budgets for the business
- Liaising with independent advisers to purchaser and vendor
The Job
Firstly, meetings were undertaken with the purchaser and the vendor and their advisers regarding the process involved if the sale was to take place. It was vital that the parties involved had full understanding of the implications and their personal requirements.
Phil discussed what the return on investment was likely to be. Once complete understanding and confirmation was obtained, the finance applications and business budgets were drawn up. The solicitors for the purchasers and vendors were all briefed on the job.
The CABEL Tax team provided taxation advice for the business.
After assessing the existing structure, Phil recommended a change from an incorporated medical practice to an associate-ship structure. Making these recommendations enabled separation of shareholder families to give greater flexibility for succession planning and access to the small business capital gains tax concessions. Thirdly, it enabled remuneration planning at an individual rather than corporate level.
Importantly, the families were advised of the advantages and disadvantages of changing structure so that they could make an informed decision of whether to proceed with that structure. The decision was made to go ahead. The continuing Doctors were also advised on the personal cash flow implications of the new structure
From there, the solicitors were briefed to prepare an associate-ship agreement as opposed to the former shareholders’ agreement. The associate business was set up for each Doctor and the bookkeeper advised of changes related to the new structure.
Results and benefits
The Doctors are now operating in a new structure after a clean sell out of one of the shareholders, with more flexibility and tax savings.
CASE STUDY: Property Purchase, Fit Out and Move
Client: Professional Practice in Southern Sydney
The Directors of the Practice had been looking for new premises The Practice found a property which the architect said would be suitable to buy and fit out.
The Role of CABEL Partners
Phillip Browne was asked to project manage the lease, fit out, finance etc. This involved:
- Developing a proposal to shareholders’ families for the structure of the purchase and financing the application.
- Investigating taxation implications and tax planning for the practice and shareholders
- Preparing cash flow forecasts for the practice and the property owner entity.
- Liaison with architects, solicitors, bankers and valuers with regard to the purchase property.
- Negotiate subtenancies, including interviewing potential tenants and liaising with Directors to draw up subleases
- Provide investment allowance taxation advice
- Subsequently restructured the Quickbooks file to report on the key areas of the business. A revolutionary change.
The Job
By project managing this large and detailed move, the Directors were able to continue operating the practice efficiently and earning income, largely unimpeded. Phil and the CABEL team took on the role of negotiator and business advisor for the project.
The purchase and finance process was outlined in detail and presented to shareholders and Directors with all supporting documentation over a series of meetings at the homes of the shareholders, at a time convenient to them.
The steps in the process were discussed in detail to elicit understanding and questions were raised to clarify. The finance applications were presented and explained to ensure there were no ambiguities or misunderstandings.
The result was the shareholders clearly understood the steps in the process and approved the new structure, the purchase of the building and finance applications.
Result & Benefits
Asset protection managed debt and equity was managed and short and long term income tax and capitals gains tax benefits were maximised.
