Family group restructuring and succession planning

Background

The client is a family group built by its founder over more than 30 years, made up of 11 companies in rental real estate (offices and factory space), construction and building materials trading. Shares were held in a scattered way by family members and a few trusted associates. The founder wished to hand day-to-day management gradually to two of his children over the next five years, but there was no mechanism governing ownership, decision rights or the interests of family members not involved in management.

Challenges

• Cross-shareholdings between companies, and numerous intra-group loans and guarantees that had not been fully documented.
• Several companies were largely dormant but still incurred maintenance costs and reporting obligations.
• High-value real estate was held across many entities, and internal transfers could trigger significant tax liabilities.
• Family members had different expectations regarding roles and dividends.

Our approach

• Weeks 1–5 — ownership mapping: charted ownership, intra-group loans and guarantees across the 11 companies, reconciled against enterprise registration records and accounting books.
• Weeks 6–11 — structuring options: compared three ways of consolidating ownership under a holding company, assessing tax cost, timing and the impact on leases and bank loans.
• Weeks 10–16 — family governance: held individual interviews with nine family members and drafted a family charter covering a family council, criteria for joining management, dividend policy and what happens when a member wishes to sell.
• Weeks 15–22 — implementation: dissolved three dormant companies, merged two companies in the same line of business and transferred shares to the holding company in stages.
• Weeks 20–24 — succession: a five-year roadmap for the second generation, with roles, review milestones and the founder's advisory role.

Results

The number of companies fell from 11 to 6, and all ownership was consolidated under one holding company held by family members in agreed proportions. Intra-group loans and guarantees were documented in writing, and annual entity maintenance costs decreased by about 35%. The family charter was signed by all nine members. For the first time, the group produces quarterly combined financial statements, giving the family council a single set of figures to monitor performance.

“Restructuring a family group is about people before it is about paperwork. We spend a lot of time listening to each member so that the solution is one everyone can accept.” — Ms Truong Minh Chau, Managing Partner, Corvane Advisory

Lessons learned

Succession should begin while the founder is still running the business, leaving time for mentoring and adjustment. Consolidating real estate ownership requires careful analysis of tax costs and sequencing; not every asset should be moved. A clear family charter reduces future conflict, particularly with members who are not involved in management.