问题如下：
Keller and John C. Hill, the sole owner of JCH Equipment Leasing Co. (JCH), meet to further consider alternate strategies to achieve his objectives of selling JCH, diversifying his single asset concentration, minimizing taxes, and retiring within a 3−5 year time period. Hill believes that tax rates are likely to increase in the near future. In the course of a discussion with Hill, Keller recommends that Hill meet with a reputable "middle market" private equity firm to discuss a leveraged recapitalization strategy.
Describe a leveraged recapitalization strategy and determine if this strategy will accomplish Hill’s objectives.
选项： 解释：
A leveraged recapitalization is a strategy that involves retooling a company’s balance sheet in partnership with a private equity firm. A recapitalization strategy is a "staged" exit strategy, which allows the owner to have two liquidity events, one up-front and a second typically within a 3 to 5 year timeframe, when the private equity firm cashes out of the investment. The private equity firm generally invests equity capital and arranges debt with senior or subordinated lenders. The owner transfers his/her stock for cash and an ownership interest in the newly capitalized entity. This allows the owner to monetize a significant portion of his/her business equity (typically 60% to 80%) and retain significant upside potential with the remaining ownership (typically 20% to 40%). The after-tax proceeds the investor receives could be deployed into other asset classes to help build a diversified portfolio. Additionally, the retained stake motivates the owner to grow the business.
From a tax perspective, the owner is taxed currently on the cash received and typically receives a tax deferral on the stock rolled over into the new entity. This strategy would be appealing to a business owner considering selling a private business in the near future and residing in a jurisdiction where tax rates are scheduled to increase.
A leveraged recapitalization strategy appears to be appropriate to meet Hill’s objectives. The strategy would allow Hill to reduce the risk of his wealth concentration, generate liquidity to diversify his single asset concentration, minimize his tax liability before tax rates increase, and retire in a 3-5 year time period.
为什么会产生deferral tax？卖出去的股份不是会直接转换成cash然后交capital gain tax么？谢谢老师~
