There are many reasons why a minority investor might want to leave a business or partnership. Sometimes, there is a difference in opinion and strategy that is best resolved with a business divorce. Often, the motivation could be entirely personal, like a retirement or a marital divorce. A family business in divorce creates challenges for both spouses and for the business and its owners (married business partners in divorce and other investors).

A fair and quick exit means that minority investors receive appropriate valuation and quick access to liquidity. Exiting minority owners should not have to remain dependent on a business and former partners. Similarly, a minority investor should not have to enter into a prolonged payout structure just to realize a more fair valuation.

In a divorce, the desire for the exiting partner to achieve financial independence is even more pronounced. Additionally, the martial divorce could influence third party investors in the business or partnership.

Apsara Partners provides financing for businesses and partnerships to purchase minority interests. We enable minority investors to realize an equitable and fast separation. However, we know that a business and its minority owners might lack the immediate liquidity for an immediate buyout. With capital from Apsara Partners, all parties can move on more quickly, fairly, and equitably.

A: Unfortunately, the answer depends on the laws of your state and any other agreements that you and your spouse made. We recommend that you speak with a legal expert who knows your state laws and personal situation.

However, most states use Equitable Distribution standards, where all assets accumulated during marriage are divided fairly (equitably), but not necessarily equally. Even in Community Property states, where there are clearer lines between individual and shared ownership of assets, there are many situations where both parties will have an interest in a private business in divorce.

Odds are, a private business owned by one or both spouses will be included in the divorce negotiations. We provide capital to help unlock value from private businesses so ownership interests can be divided and shared more easily and equitably.

A: We recommend that you speak with a legal professional more on these matters. However, in many cases, a private business is treated as one of a variety of assets in marital divorce. How the assets are split is a negotiated process between the parties.

Yet, unlike more liquid assets (e.g. cash, savings accounts, retirement assets), business interests are difficult to divide. Additionally, private companies are tough to value. With the assistance of legal counsel and other experts, Apsara Partners provides funding to help businesses unlock value for all parties involved.

A: Often both parties in a marital divorce have claims to a private business. However, often just one spouse wants to remain in a business after a divorce. If it is desirable for one spouse to fully exit a business, the exiting spouse will have to be compensated with adequate value. Sometimes, there are enough other assets to make this process relatively simple.

Yet, if a business comprises a significant portion of all marital assets, valuing interests in the business and dividing value becomes a substantial challenge. The lack of other assets and liquidity means that (absent outside capital) the two parties will remain economically involved in the business post-divorce. There could be a multi-year buyout process or both parties might retain equity interests in the enterprise.

If these options are not appealing, Apsara Partners might help to find a solution. We provide financing to business to support immediate buyouts of minority interests. Please contact us to learn more.

A: A marital divorce does not just affect the former spouses. In many circumstances, a divorce causes financial strain and a lack of liquidity for both parties. Unfortunately, there can be ramifications for associated businesses and limited liability companies (LLCs). A negotiated transaction could require immediate funds or ongoing cash flows out of the business or LLC. In other circumstances, both spouses remain involved in the business and might have competing opinions. Sometimes, partnerships and LLCs require a buy-out; this is often the case for professional partnerships that do not allow non-qualified owners (e.g. law firms).

In all of these situations, we believe that outside capital from Apsara Partners can help. We enable fast and fair business divorces and buy-outs that maintain business continuity and improve financial health. We believe that working with us can help to avoid additional conflicts between business partners and ensure fair outcomes for all parties.