Billionaire leaves majority of the furniture giant IKEA under the control of a company
A recent story online found here reveals the estate plan of the billionaire founder of the furniture giant IKEA. Feodor Ingvar Kamprad (March 30, 1926 – January 27, 2018) founded IKEA in 1943 in Sweden. Mr. Ingvar founded his company at the age of 17. At the time of his death at the age of 91, he was believed to control a global retail empire valued at US $58.7 billion. After his death it was publicly revealed that he structured his business in a way that would ensure the survival of his company.
His heirs will not get control of IKEA. Instead, they stand to receive a fortune estimated to be valued at US $10 billion. The heirs stand to gain control of a collection of finance, real estate, manufacturing, and retail businesses derived from the family owned Ikano Group.
The bulk of the US $58.7 billion empire will not be controlled by the heirs. Most IKEA stores are apparently owned by the Stitching Ingka Foundation. The purpose of this foundation is to donate to charity and support innovation in design. Ingvar Kamprad structured the ownership of his company so that it was impossible for an individual, even an heir, to assume control after his death.
Ingvar Kamprad took care of heirs and ensured his business would continue
The way IKEA’s founder arranged his empire allowed him to leave plenty of funds to his heirs. The arrangement also enables IKEA to continue operating. Mr. Kamprad did not disinherit his family. He made it difficult for conflicting interests to interfere and threaten his lifelong accomplishment.
Mr. Kamprad had a reputation for being very practical. He lived a modest life and was known to have little interest in money. The way his company was arranged seems to reflect his practical and frugal nature. Many other wealthy individuals fail to organize their affairs before death. After they die, their families commence bitter and prolonged litigation.
Their businesses have to get sold, or certain individuals may have to be bought out. As a result, an individual’s legacy is tarnished after death. Mr. Kamprag should serve as an example to wealthy individuals who are looking to organize their affairs effectively.
It will be interesting to follow this story. More here.