At Cardiff Lexington, we provide business owners the funds needed to expand and grow their business, as well as an equity exit and liquidity strategy for the owner, heirs, and/or investors. Our acquisitions become standalone subsidiaries that gain the advantage of the power of a public company without losing their independent management control.
Management enjoys the advantage of improved valuation, liquidity, synergies and support, along with diversification and asset appreciation through collective subsidiary performance. Diversification and pooled resources leverage value and mitigate risk.
Our focus isn't industry or geographic-specific, it's opportunity oriented. Our growth focus through perpetual acquisitions centers on serving the successful business owner in three main categories, while also including diverse and synergistic industries such as healthcare, technology, and food and beverage. Our target composition of holdings over time are targeted to represent:
Income Producing Commercial Real Estate Companies
Small to Mid-Sized Privately Held Companies
Second Stage Startups - Emerging Growth Companies
According to the IRS Section 368(a)1(B), there is a process in which all parties involved in an acquisition are free from reporting a Capital Gain or a Capital Loss, thus being a Tax-Free Exchange. This process requires us to exchange our "qualified" Preferred Stock that is voting for control of the newly acquired company. We acquire 100% of the "vote and value" of the company's stock. Each company is awarded an exclusive series of Preferred Stock. We authorize and issue this Preferred Stock to the new company thus completing the acquisition. In addition, we authorize a sub-class in the same exclusive series of Preferred Stock that is non-voting for the purpose of raising working capital. Once the Company becomes a wholly owned subsidiary, they will receive their own class of Preferred Stock. This preferred class becomes their platform to raise the necessary capital to expand their business.
All acquisitions are added to our consolidated balance sheet creating tangible value for everyone. Acquisition assets are not co-mingled and operational autonomy is maintained.
Our whitepapers are available to help you better understand our investment strategy.