Formal and informal structures shape organizations and the interaction of actors within.Surprisingly, just recently organizational theorists have started focusing on studying the interplayof both structures. However, most studies focus on how formal influence informal structures,viewing formal changes as clear. Building on a 16-month case study of a reorganization and CEOsuccession in a family-owned company, the study investigates the interplay of formal and informalstructures. I find that informal structures can, in times of weak formal structures, partly substitutetasks of the formal organization through processes of encapsulation and rerouting, creating atemporal ‘shadow organization’. The study thus contributes to the literature on organizing andorganizational design by showing how informal structures can shape formal organizing.