Listen to a podcast with business appraiser Tony Cotrupe (Melioria Advisors), who tells the story of getting in the middle of two battling brothers who co-own the family business. Each brother wants the other one out the door, so the challenge is to come up with a value of the company both sides can live with and avoid long and ugly litigation. Cotrupe tells his fascinating tale to Peter Mahler, a business divorce attorney with Farrell Fritz in New York City.

Mahler has done a whole series of podcasts on business divorce, many of which include valuation issues, and he also has an excellent blog. Check them out!

Practice op: One way to help clients through potential trouble such as this is with advice on exit planning. This includes how value is determined in the buy-sell agreement, which is often very vague or nonexistent. A common recommendation is for an outside expert to perform a valuation upon some triggering event. One that is not so common is to use a predetermined fixed price that is periodically reviewed and adjusted.

BVR just conducted a webinar on this matter, Business Prenups, Relationship Counseling, and Corporate Divorce: Business Lifecycles and Their Impact on Valuation. The presenters were valuation expert Mark Zyla (Acuitas Inc.) and attorney William Piercy (Berman Fink VanHorn).