Freedom Communications, Inc: Family Enterprise or Liquidity?

The case presents the history and continuity challenges of Freedom Communications, a family business that by the new millennium had become the twelfth largest media company in the US, with about 7,000 employees and estimated value between $1.5 and $2 billion. The case details intra-family conflicts related to maintaining Freedom as an ongoing business versus exploring liquidity-generating options including selling the company, spinning off businesses, and going public. In August 2002 a narrow majority of family owners voted to explore liquidity options in detail.

Freedom had been in business nearly 70 years by that point, and had weathered family strife including disagreements about what second-generation members were best qualified to run the firm and a related lawsuit to dissolve the business. Since the early 1980s, only non-family executives had served as CEO, but family members continued to be involved as employees and owners, contributing to ongoing disputes about leadership, sale of shares, and the business's future. These interactions culminated in the decision to explore broad liquidity options. Students will explore how a mature family business should manage succession-related and liquidity-option issues within and across generations to ensure that family owners, managers, employees, and shareholders remain satisfied with their roles, company performance/operations, and share ownership.