George Steinbrenner has been the face of the New York Yankees for some time. His recent passing showed how a great succession plan can work on just about any scale. 

The New York Yankees are the iconic team of Major League Baseball, one of the best known brands in the world. Owned by George Steinbrenner for thirty plus years, the team is incredibly valuable. This raised interesting issues from an estate planning perspective. Put simply, how would the transfer from Steinbrenner to a successor occur? It wasn’t that long ago that the O’Malley family who owned the Los Angeles Dodgers had to see because they could not figure out a way to pay the IRS in a similar situation. 

With the death of the patriarch, the Yankees have continued seamlessly. How can this be? For all his faults, George Steinbrenner was a smart business man. He obviously put in place a succession plan for the continuation of the team. The last few years have seen him give up power in the business as his two sons moved into ownership positions and effectively began to run the company. 

How was the ownership transfer done? Nobody knows since it is a private business. That being said, the transfer most likely occurred through a combination of gifting ownership interest, providing loans to the boys to buy shares and so on. The point is a plan was put in place and what could have been a major interruption to the business has been handled smoothly.

The succession plan for the New York Yankees also shows us the flexibility of such plans. The original plan was for Steve Swindal to take ownership of the team. Who is this man? He was the husband of Steinbrenner’s daughter. When that marriage failed, Swindal was written out of the plan. 

So, what about estate taxes? How is the succession plan handling those? We won’t know because of an odd bit of luck. There is no estate plan in 2010. As a result, the Steinbrenner sons currently don’t need to pay anything. A bit of luck for them, no? 

A succession plan is a critical part of any overall business plan. Please contact us to learn more.