An enduring trust-based relationship with a private family

APPOINTED TO BOARD OF THE WEALTH-GENERATING COMPANY OWNED BY A PRIVATE FAMILY CLIENT, THE ROLE CHANGES AS OPERATING COMPANY BECOMES INVESTING COMPANY

BVI company established in previous years by successful businessman and son-in-law. Following the demise of the father in-law, the second generation was advised to establish and reinforce a specific tax domicile. The adviser (who had been my employer in London over 20 years previously, at the start of my career immediately after my qualification as a solicitor) directed the family to me in Jersey. Appointed as the only non-family member on the board of the family’s wealth-generating company.

My involvement

Initially, the company’s business was to provide equity financing facilities for North American biotech businesses, needing access to capital to finance development of new pharmaceutical and other medical products from early stage development through to licensing, commercial launch and revenue generation.

My role included providing a venue for board meetings in Jersey and, as a board member, was to understand the terms of each deal and approve or not, and if approved to assist the CEO and work with the company’s New York lawyers in closing the transaction. Regular board meetings were held at the Jersey venue to oversee the structure, financing and operation of the company and to monitor the performance of each of its current deals and prospective opportunities.

The company made substantial money to add to the family wealth and, when the market closed up, the board decided to change direction towards investing the cash-pile in equity opportunities with private companies, which to date have been in Australia, South Africa, the UK and Jersey, and have covered diverse industries, not just biotech. The company came to operate as a typical private equity investment vehicle in the ownership of a single family and investing only the family’s own money. My own offering has expanded into board roles for investee companies where that level of involvement was felt needed to protect the family’s investment.

Outcome

The company developed successfully in its aim to continue adding  to the family’s wealth following the original market in North America closing up and the change of direction towards equity investment in privately-owned businesses. After more than thirteen years I continue to work closely with the family as their “gate-keeper” and provide input on new investment opportunities as well as transaction management on inward investment. No exits have yet taken place.