Succession planning and the Market Basket debacle
To the editor:
I had the opportunity to read the article by Liisa Rajala on the Market Basket debacle (“Market Basket: A business case study for decades,” Aug. 8-21 NHBR), but found that the article lacked any discussion about how the families got into this mess, and how it could have been avoided.
The fact is that that the Demoulas brothers, Telemachus and George, failed to enact a formal (and well-documented and -funded) buy/sell agreement.
When George died, instead of his family being bought out in cash for his share of the business, his shares were left to his family, who then relied on the "good faith" of Telemachus and his side of the family. We (now) see how well that worked out. Millions of dollars wasted in court, and now, millions wasted in a dispute that enriches only the lawyers.
The larger tragedy is that this is not an unusual situation, just unusual in its size.
Every day, business ventures are torn apart by death, disability, retirement and irreconcilable differences between the partners. It is critical that when two or more people enter into a business venture together, that business succession planning be done from the outset, so as to preempt this kind of situation.
A good estate and business planner, along with a good business attorney, can assist in exploring the options and developing the plans and documents before the crisis hits.
The last thing that any good business and family person wants to do is to leave their family (and possibly their employees and vendors) in a bad place if and when the "unspeakable" happens.
Stephen N. Mathieu
Legacy Financial Solutions Inc.