As succession planning approached, Lakeshore Plumbing faced a decision where balance sheet choices carried personal consequences. The case centered on valuing the business and structuring a share repurchase and recapitalization ahead of the founder’s retirement, while preserving family control and financial stability. Rapid growth had increased leverage sensitivity, exposing the firm to rising interest rates and tighter liquidity at a fragile point in the cycle. The analysis focused on separating economic value from implementation risk, evaluating debt capacity, cash flow resilience, and fairness across stakeholders. The recommendation prioritized liquidity protection and phased execution, highlighting that in family owned businesses, technically sound financing must also survive governance, timing, and succession realities.
