Business Valuation Update
- How to Review a Report’s Valuation Methodology
- Ideas for Solving Two Problems in the BV Profession
- How Do Your Firm’s Benefits Stack Up?
- Using Rule of Thumb Data to Uncover Cooked Books
Cellular Telephone: An Interesting Decision for Valuation Practitioners
A recent Delaware decision in a breach of fiduciary duty case awarded more than triple the amount originally paid to partners who were squeezed out of their collective 1.881% interest in a partnership. Several aspects of this decision are of particular interest to valuation practitioners, especially those whose practice includes litigation services. The case is: In Re Cellular Tel. P’ship Litig.; 2022 Del. Ch. LEXIS 56 (Cellular).
The Discount Rate in Damages: Dunn’s Cases You Need to Know
The Discount Rate in Damages: Dunn’s Cases You Need to Know BV appraisers and litigation experts are especially invaluable to attorneys when it comes to compiling and calculating the financial evidence in an economic damages/business valuation case. Fr ...
Kick-Starting a CPT Revenue Analysis for a Physician Practice
An example of how to get started on a Current Procedural Terminology (CPT) revenue analysis for an orthopaedic practice, including detailed background data on this type of practice.
DLOMs in N.Y. Fair Value Cases: Private Company Discounts Are Not Caused by Lack of Marketability
Are private companies worth less than public companies solely because they are not publicly traded or because of other identifiable factors (some of which would apply to various public companies as well)? A school of thought consisting of experienced and ...
Guideline public company method - control or minority value?
Conventional business valuation wisdom says that the guideline publicly traded company method (GPCM) results in a minority value.
Valuation Considerations in High Inflationary Environments
With inflation at its highest level since the Great Inflation, valuation analysts will have to consider macroeconomic factors that have not been present in the U.S. economy in over 20 years.
Savings Bank Wins a Few, Loses a few Under a Slough of Damages Theories
On Sept. 5, 2002, the court issued a liability opinion holding that the United States, through the enactment of the Financial Institutions Reform, Recovery and Enforcement Act of 1989 (FIRREA), had breached an express contract with Franklin Federal Savings Bank to treat its supervisory goodwill as a regulatory capital asset amortizable over 25 years.
Wife says court erred in valuing husband's stock options
Wife contends that the trial court erred in calculating the value of husband's employee stock options in Eli Lilly & Co.
Chancery court charts own course in appraisal action
The issue in this appraisal action was the value of the shares of eMachines Inc., a company that provided low-cost computer goods to consumers.
Merger Prospectus Criticized for Misleading Discount Rate and Management Projections
Delaware Chancery enjoins merger based on flawed proxy statement, including overstated discount rate in valuation and selectively chosen cash flow projections.
Jury Awards $10 Million Lost Value for Internet Startup—But Court Dubious on Damages
Court reverses a $10 million damages award for the lost value of an internet startup for failure to show any record of profitability, working capital, or products to sell.
Bankruptcy Expert Claims DCF Indicates Market Value Better Than the Market
Court authorizes $1.1 billion asset sale of the debtors, despite DCF by lenders’ expert that shows $13.8 billion value.
WACC Rejected as Value Measure
The issue in this estate tax matter is the fair market value of decedent James J. Renier's 88.4% interest in the Renier Co., a family-owned electronics retailer in Dubuque, Iowa.
DE Chancery Favors Supply-Side ERP, Rejects Size Premium ‘Liquidity Adjustment’
Delaware Court of Chancery prefers supply-side equity risk premium over historical ERP in statutory appraisal action, but rejects “novel” liquidity adjustment to size premium.
Intrinsic Value Appropriate in Marital Dissolution so No Discounts Applied
The issues in this case were whether, in valuing husband’s business interest, the trial court abused its discretion by failing to apply (1) a discount for lack of control (2) a discount for capital gains tax consequences (3) salary adjustments.
Tax Court Chooses Market Approach Over Asset Approach
The issue in this consolidated case involving the Caracci family was whether the value of the Sta-Home Health Agency Inc. (SHHA) and related entities transferred into S corporations exceeded the consideration paid.
Relief-From-Royalty Method Inappropriate for Sale of Intangible Assets
In January 1985, Carnation Co. became a consolidated subsidiary of Nestle Holdings Inc.
Chancery Adopts Merger Price Sans Cost Savings Reduction
Chancery agrees with company expert’s reliance on merger price as best estimate of fair value of company where DCF and comparable companies analyses lack reliable data, but court rejects downward adjustment for purported cost savings related to merger.
Tax Court Determines Capital Gains Discount for Real Estate Holding Company
This issue in this estate tax matter is the fair market value of decedent's 82.76% interest in Valley Improvement Co. Inc. (VIC), a real estate holding company, as of Jan. 12, 1994.
Bankruptcy Court Rejects DCF for Troubled Company
Bankruptcy court rejects DCF analysis in valuation of early-stage mobile satellite systems provider, preferring comparable company analysis provided the debtors’ expert.
Merger-Related Projections Pass Muster With Delaware Chancery
In statutory appraisal action, Court of Chancery discredits respondent’s comparable company analyses because the comparables were significantly smaller than the target and not in the same industry or had different multiples; as to the DCF analysis, the ta ...
Court Rejects Adjusting Cap Rate Earnings to Apply to S Corporation
The issue in this estate tax matter is the fair market value of decedent William G. Adams Jr.'s 178 shares of voting common stock (a 61.59% interest) of Waddell Sluder Adams & Co., Inc. (WSA), an insurance agency that operated as an S corporation.
Bankruptcy Court Determines Fair Market Value Under Pennsylvania Judgment—Court Details Claimant's Expert's Valuation Shortcomings
The issue in this bankruptcy court proceeding is the appropriate valuation of 4,500 shares of stock of Quality Systems Associates Inc. (QSA).
Ibbotson-Derived Discount Rate Subject to Daubert
Court disallows expert theory of “lost opportunity cost” damages for breach of contract, but admits his “standard” lost profits analysis, including reliance on agreed-upon forecasts and an Ibbotson-derived the discount rate.
Courts Wrestle With Discount Rate for Future Stock Price Increase
In retaliation suit requiring valuation of company restricted stock, district court, despite hesitation, affirms expert’s proposed zero percent net discount rate finding expert provided some support for it.