Splitting the Business to Unify the Family

Sometimes a family has to divide a business if it's going to conquer problems that threaten family unity, as David Boyd recently learned. His younger son, Kevin, had been managing the family's building materials distribution business for seven years while David's older son, Steve, wandered through a variety of jobs. David worried about Steve, who hadn't quite found himself. He invited Steve to join the family business. Steve accepted.

Kevin, who considered the business his company, resented his older brother's new involvement and found numerous reasons to criticize his behavior. Steve, on the other hand, resented Kevin's favorite son status. Kevin was further dismayed when, a year later, David began to consider transferring the business in equal parts to his two sons. Previously, he had made a gift of 20 percent to Kevin and 10 percent to Steve and retained the rest of the stock.

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