Business Valuation Update
- Perception Grows of Bias in U.S. Valuation Experts
- Popular Real Estate DLOC Database Is Not Going Away
- Key Points From Hitchner’s Annual BV Update
- What to Glean From the IRS Hiring Binge for BV Experts
Do Not Be Afraid to Take Much Higher Discounts During the Recession
The latest 2008 restricted stock data provide concrete proof that the discounts for lack of marketability have never been higher. By tying the VIX—the ticker symbol for the Chicago Board Options Exchange Volatility Index, a popular measure of the implied ...
Do Maximum Strike Price Lookback (Longstaff) and Other Put Option Models Produce a Marketability Premium or a Discount?
Maximum strike price lookback (Longstaff ) and other put options models are achieving greater acceptance as liquidity components in estimating discounts for lack of marketability. As users of valuation reports demand greater precision and replicability ...
Using a Restricted Stock Study Quintile Analysis for a DLOM
Editor’s note: Restricted stock studies are often used when developing a discount for lack of marketability (DLOM). However, certain characteristics of the issuer of the restricted stock can impact the discounts in the studies. This article presents pages ...
Adjustment Mapping and the Public-vs.-Private-Company Discount Debate
Editor’s note: This article advances the discussion in the article “Private Company Discounts Are Not Caused by Lack of Marketability” that Gilbert Matthews wrote for the June 2016 issue of Business Valuation Update. The author of this article joins the c ...
Minority and Marketability Discounts Are at Court's Discretion
Shareholders were offered $20 per share in a squeeze-out merger, effective July 31, 1997.
Application of Minority, Marketability Discounts Was Error
In this corporate dissenter's rights action, Lindoe Inc. appealed the trial court's valuation of its stock in Pueblo Bancorporation, a bank holding company.
Letter to the Editor, Definitional Problem Underlies N.Y. Courts’ Unfair DLOM Stance
Dear Editor: Thanks for highlighting the article “NY’s Unfair Application of Shareholder-Level Marketability Discounts” (BVU, January 2016). I believe the problem with the case law is definitional. Whenever parties discuss DLOMs or any valuation discou ...
DLOMs in N.Y. Statutory Fair Value Cases—A Follow-Up to Matthews
As an appraiser, I have had the opportunity to prepare many valuations for New York statutory fair value cases, and I have testified in some of them. I’d like to weigh in on the topic of discounts for lack of marketability (or DLOMs) as a follow up to the ...
How Fast Do DLOMs Change?
Our studies of LEAPS and the costs of price protection show clearly that discounts for lack of marketability (DLOMs) change over time. But how much do DLOMs change? The answers are: quickly, often, and a lot. The factors causing change appear to be cond ...
BV News and Trends April 2024
A monthly roundup of key developments of interest to business valuation experts.
Partnership Valuation Focuses on Minority, Marketability Discounts
The issue is the value of one general partnership unit (out of 95) in FC Partners as of decedent's date of death, Dec. 31, 1989.
Minority and marketability discounts rejected in valuing 34% interest
In this marital dissolution case, one of the primary issues was whether the trial court abused its discretion in valuing the husband's shares in sporting goods stores.
BV News and Trends January 2023
A monthly roundup of key developments of interest to business valuation experts.
BV News and Trends November 2023
A monthly roundup of key developments of interest to business valuation experts.
BV News and Trends March 2023
A monthly roundup of key developments of interest to business valuation experts.
Mississippi Supreme Court Upholds Rejection of Minority and Marketability Discounts
This case came to the Mississippi Supreme Court on appeal from the Court of Chancery.
Does Fair Value of FLP Include Marketability and Minority Discounts?
Court considers whether discounts apply to statutory fair value appraisal of partnership withdrawal/dissolution.
8th Circuit Rejects Discounts for Marketability, Minority in Missouri Dissenting Shareholders' Appeal
The 8th Circuit reviewed de novo Swope v. Siegel-Robert, 74 F. Supp. 876 (E.D. Mo. June 23, 1999) (abstracted in BVU October 1999).
Court Allows Both Minority and Marketability Discounts for 50% Stock Interest
The issue is the value of a 50% stock interest in a small consumer loan company with a book value of $2,168,839.
Fair Value Excludes Minority, Marketability Discounts in South Dakota
This shareholder dispute appeal raised issues of expert testimony admissibility and the trial court's interpretation of fair value.
Marketability Discounts Include Contingent Legal Liability but Not Contingent Sale
Appeals court reviews application of discounts for contingent liability and contingent sales costs.
2032A Special Use Reduction Is in Addition to Minority and Marketability Discounts
The U.S. Court of Appeals for the 10nth Circuit concluded that, for the purposes of applying the IRC sec. 2032A maximum valuation reduction, the value of the interest is to be calculated using fair market value inclusive of applicable minority and marketability discounts.
Restricted stock discounts, 1991-95
We're very pleased that Bruce chose Business Valuation Update for the initial publication of this latest in a long series of restricted stock discount studies.I think it's particularly useful that he empirically identifies three factors that impact the magnitude of the discount for lack of marketability.
Limited partnership unit sales show large discounts from net asset value
This article focuses primarily on discounts for limited partnership interests, and also mentions discounts from net asset value (NAV) for companies in corporate form, detailing a few of the authors' own experiences in reaching settlements with the IRS.
Market Volatility and Its Impact on the Valuation Advisors Pre-IPO Database
The recent stock market volatility has ripple effects on pre-IPO studies, which are used to estimate a discount for lack of marketability (DLOM).