Northeast Ohio Deal Activity: Estate tax planning considerations for contemplated M&A transactions


The landscape of estate tax planning is set to undergo a significant change in the coming years, as the estate tax exemption is set to revert to pre-2018 levels at the end of 2025. This means that married individuals with estates valued at more than $14 million (half of this if single) will once again be subject to estate taxes, with rates ranging from 18 percent to 40 percent. However, recent proposals by the Biden administration may accelerate this change, with some experts predicting that the estate tax exemption could be reduced as early as the end of 2024.

The changes to estate tax planning also have implications for mergers and acquisitions activity. With the potential for the estate tax exemption to be reduced as early as the end of 2024, founders and families involved in M&A transactions may need to be more proactive in their estate planning efforts to ensure that their assets are protected and their estate tax liability is minimized. This may involve the use of trusts or other estate planning vehicles to transfer assets to beneficiaries in a tax-efficient manner (i.e., while values are lower), as well as the use of insurance policies or other strategies to provide liquidity to cover potential estate taxes.

Overall, the pending changes to estate tax rules highlight the importance of taking a holistic approach to M&A transactions, one that considers not only the financial and strategic implications of the transaction itself, but also the estate planning and tax implications for high-net worth individuals and families.

By working with experienced professionals and staying informed about changes in the tax landscape, individuals and families involved in M&A transactions can ensure that they are well-positioned to protect their assets and minimize their tax liability.

M&A Market Activity

U.S. deal volume declined in April 2023 as compared to the prior month. Through the first four months of 2023, U.S. M&A deal volume decreased by over 25 percent compared to same period in 2022.

Similar to the overall U.S., the Northeast Ohio M&A market experienced a decline in deal volume in April 2023, with deal volume falling by 12.5 percent as compared to March 2023. April 2023 did, however, see several noteworthy transactions in the Northeast Ohio region. Northeast Ohio-based companies Applied Industrial Technologies, The Timken Co., Outerbox Solutions, Clearstead Advisors and MAI Capital Management completed strategic acquisitions within the month.

Deal Of The Month

On April 1, 2023, Pickard Commercial Group LLC a commercial real estate platform in Akron, merged with Pleasant Valley Property Management LLC, dba NAI Pleasant Valley. The combined companies will continue to operate under the NAI PVC name. NAI PVC, with offices in Akron and Cleveland, is a provider of commercial real estate brokerage and property management services in Northeast Ohio. As a result of the merger, the newly combined companies will offer a comprehensive suite of real estate services ranging from leasing/sales to property management, and through its parent company, Pleasant Valley Corp., construction and facility management services.

“We are delighted to align our platform with [Jim Pickard’s] business,” says Gino Faciana, NAI PVC’s Co-CEO. “For the past two decades, he has grown one of the leading top commercial real estate firms in Akron and the surrounding market. Because of his dedication to this industry, the future of NAI PVC will be even more exciting.” ●

Tom Freeman is a Senior Advisor and Evan Lyons is a Vice President with MelCap Partners, LLC, a middle-market investment banking advisory firm. For more information on MelCap Partners, please visit or email [email protected] or [email protected].