Javier started his real estate business years ago. He now owns the building on Main Street that

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Question:

Javier started his real estate business years ago. He now owns the building on Main Street that houses the business and has 20 agents working for him. He has had several offers to buy the business for as much as $7 million without the building and $10 million with the building. In both cases, non- compete clauses and a transition period of consulting were discussed. His non- business assets are worth about $5 million. At the age of 75 he is in fair health but would like to wind down his involvement in the business. Two of his children work for him and his third child teaches. As you answer the questions that follow, discuss the factors that would push in one direction or the other.

a. What are the advantages of selling the business now?

b. What are the advantages of holding the business until he dies?