What is a family business and what makes a family business unique from all other business entities?

 

What are the most important operational and legal processes that need to be established to promote business success and to mitigate personal risks?

 

How can a family business survive multiple generations and the transition of leadership?

 

Does a family business need to formalize communication and conflict resolution, roles and responsibilities, and compensation plans?

 

What is the role of tax and estate planning in a family business?

"Not Taking Any Client for Granted Even After 25 Years of Exceptional Service"

AAMCO

 

Situation

Over forty years ago, family-owned AAMCO was built on a vision that redefined the automotive repair industry. Founder Robert Morgan identified a void in the automotive services industry and seized the opportunity to develop a business specializing in repairing automatic transmissions. Through calculated risks, an innovative business model, and an instinctive marketing mind, Robert Morgan grew the company to become the largest transmission repair specialist in the country.  Today, AAMCO is one of the best known brands in the automotive aftermarket, with over 92% brand awareness by the motoring public.

In 1992, Robert’s son, Keith Morgan, took over the helm of the company as CEO. The company continued to grow under Keith’s leadership, and by 2003 the company had expanded its business to include complete car care services.

By early Fall of 2005, following the death of Robert Morgan, the family began considering opportunities to remodel the business and continue the family legacy.  The range of opportunities included selling the business to investors with a like vision, focus, and passion for the car care industry.  Finally, in the spring of 2006, AAMCO was purchased by the investment company which owned longtime rival Cottman Transmission, forming a mammoth complete car care company with nearly one billion in annual revenue, more than 1,100 stores nationwide, and one nationally recognized brand name: AAMCO.

Solution

Veteran Fox Rothschild partner and firm co-chair, Abe Reich, had represented AAMCO in various company matters beginning in the late 1970s.  Even though Reich had a 25-year relationship with AAMCO, at the time of the pending transaction, he had to compete with other recognized large firms to represent the company’s interests in the complex sale process.  And Abe Reich wouldn’t want it any other way.  Abe never takes his client’s business for granted - even after 25 years of exceptional service.

When Keith’s call for a bid came in late 2005, he made it clear that Reich would have to “make a case” for the work. Reich quickly put together a team of experienced, top-level lawyers, including the co-chairs of the firm and head of the corporate group, to make the pitch. Despite receiving competitive bids from other local legal giants, Keith challenged Reich by stating: “If you tell me you can do it, it’s yours.” Reich and his team met the challenge head on and succeeded.

The Fox Rothschild team worked tirelessly during the sale negotiations and drew upon the vast talent of the firm’s attorneys to handle all related legal matters, including sophisticated corporate issues, Federal Trade Commission clearance, ERISA, labor, and tax issues. Reich’s team targeted and understood key client issues, made critical judgment calls, and made a 24/7 commitment during the course of the deal. Reich’s litigation background offered a balanced perspective throughout the transaction.

Results

Keith Morgan awarded the bid to Fox Rothschild because he had confidence in the experience and judgment of Reich, his team, and Fox Rothschild.  Reich’s team of senior-level, seasoned attorneys brought a breadth and diversity of talent and knowledge of the company that no other firm offered.

Keith Morgan’s decision to sell AAMCO coincided with an environment that was ripe for branded merger and acquisition opportunities. Business sale activities were robust, and there was a healthy show of interest in AAMCO.  Fox Rothschild and Reich demonstrated a marriage of practical experience and tireless service. Fox Rothschild knew the business of mergers and acquisitions.  AAMCO banked on the expert advice, direction, and service offered by Reich and Fox Rothschild to execute the largest transaction in the company’s history.

Experience

Reich looks at each opportunity to solve a client’s problem as a privilege. For Reich, no problem is too trivial and no time or call is too inconvenient.  Personal care and responsiveness are his daily mantras. He does not take any client for granted and looks for ways to demonstrate his commitment to each client.