Valuations professionals are often expected to know the value of every business to the penny; however, business appraisal is not an exact science, even as it follows the parameters of a standardized methodology. The analyst’s expertise and judgment are equally important in the process of analyzing value. Each valuation has a certain amount of wiggle room, which is valuable and necessary to the process. While it’s true that a valuation has an element of subjectivity, much of the benefit a client receives from a valuation is from that same subjectivity.
Fairness opinions may be vulnerable to conflicts of interest if the firm that is providing the fairness opinion is also providing other services as well, such as merger and acquisition support. Because of the increased scrutiny from regulators and the financial investment communities, boards of directors are proceeding cautiously when considering if the value of the planned merger or acquisition is fair to shareholders.
“I have views on most matters, and I am as willing as a politician to change most of them.” -James Agate
I recently testified in a marital dissolution case in which there existed a 10-year-old buy-sell agreement among the owners of a privately held, family-owned company. The well intentioned drafters of the buy-sell agreement sought to provide for the following:
Largest Transactions Closed