Highlights of the 7 September issue:
  • How important is business valuation?
  • Control premia stabilised in 2Q, according to new BVR study
  • Does the length of a marriage affect the sharing of business assets in divorce?
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Follow the business valuation profession in the United Kingdom and its expanding role in regulatory, fiscal, contentious, and compliance valuations with BVWire–UK. Twice a month, BVWIre–UK delivers news and perspectives from valuation thought leaders, expert practitioners, academics, the High Courts, HMRC, the standard setters, and more. We’ll also keep you current on new business valuation research, methodologies, data tools, and training opportunities from ICAEW, RICS, BVR, and others. Contact us with news items and/or suggestions.

How important is business valuation?

Business valuers are accustomed to risk, volatility, and increased forecast uncertainty.

Control premia stabilised in 2Q, according to new BVR study

The “2Q 2021 Control Premium Study” report is now available from BVR.

Does the length of a marriage affect the sharing of business assets in divorce?

In the recent case of E v L [2021] EWFC 60, the court has reconsidered how the sharing principle applied to marriages that are short and/or childless.

A new resource to compare the value of all intangibles

Now in its newly released third edition, Benchmarking Identifiable Intangibles and Their Useful Lives in Business Combinations offers data on 18 categories of intangible assets including goodwill.

Does long CEO tenure reduce enterprise value?

Most business valuers depend on forecasted cash flows to determine whether the founder or owners of a business are increasing value, and some will sense that managing directors or CEOs who have held the job for a long time tend to have less ambitious growth plans.

An additional 30 June cost of capital data source from the EU

The 8th edition (30 June 2021) of ValueTrust’s “European Capital Market Study” compiles capital market parameters such as cost of capital and implied as well as historical risk premiums for European countries.

IVSC adds Morton to Financial Instruments Board

The International Valuation Standards Council (IVSC) announced that Marcus Morton, a managing director of valuation services at Duff & Phelps/Kroll’s London offices, has joined its Financial Instruments Board.

SME EBITDA multiples down slightly, per DealStats

DealStats includes audited financial statements and transaction data for small and medium enterprise deals primarily in North America.

Michael Jackson estate valuers give rare inside look

Experts for the estate of pop superstar Michael Jackson presented a fascinating look at how the business valuations were done for the “U.S. tax trial of the century” at last month’s BVR webinar.

Dates for your diary

13-16 September: IMAA’s Damodaran on Valuation, live online (repeated 8-11 November ...

DAC Beachcroft analysis points to ‘worrying trend’ among expert financial witnesses

Many in the business community wrongly assume that all accountants are business valuation experts.

Forecasting ‘going concern’ values for UK small businesses now requires careful analysis of debt repayment capacity

The overall debt level of independent UK businesses has more than quadrupled in the past year, increasing from £0.5 billion to £2.2 billion.

How does the UK’s new restructuring plan impact business valuation experts?

The Corporate Insolvency and Governance Act 2020 (CIGA), rushed through the UK Parliament in a five-week period last summer, is now over a year old.

Dates for your diary

23-24 August: Excel Modelling—Investment Appraisal, Valuation and Business Cases, ICAEW live online, 09:30-12:30 BST ...

Duff & Phelps/Ogier article compares independence requirements for lawyers and business valuers

Providing expert financial analysis advice during litigation becomes more difficult—and often unpleasant—when the lawyers who hired you don’t understand that business valuers are held to the same professional standards as they are.

iiBV update their IVS-compliant core business training modules

BVR and the International Institute of Business Valuers (iiBV) have completed the current updates of their core Advanced Business Valuation course.

Business valuers can’t afford to use bad data—an ESG case study

Large data providers Refinitiv/LSEG and SPGI have backed European and UK efforts to add environmental, social, and governance (ESG) metrics to financial reporting disclosures for listed companies.

Large private companies may require independent financial and valuation reviews, just like their listed competitors

The UK’s consultation on corporate governance and audit reform, announced in March, asserts that large private enterprises—and their directors—should be held to the same reporting standards as listed companies.

Dates for your diary

23-24 August: Excel Modelling—Investment Appraisal, Valuation and Business Cases, ICAEW live online, 09:30-12:30 BST ...

Deal prices for private equity transactions stay high—but are the underlying assets less profitable?

The new DealStats Value Index Digest notes a worrisome trend: The average EBITDA margin of deals completed last quarter dropped.

MarktoMarket finds 82% minority discount for beer enterprise

Timothy Taylor & Co, the traditional British brewer and pub owner, recently transferred a 10% share of the business.

‘Wells sharing’ may still be the least painful resolution in family law disputes with shared ownership

UK family law courts are generally loathe to force the sale of a business to satisfy the debts of a shareholder resulting from a divorce settlement.

Gallagher survey anticipates higher contingent liabilities from litigation

Two-thirds of UK businesses expect litigation claims to remain at a high level or to increase this year, with 56% having faced accusations of unlawful behaviour in the last five years.

What market risk and risk-free rates are your UK peers using now?

The average market risk premium UK analysts use was 5.6% in May, according to “Market Risk Premium and Risk-Free Rate Used for 88 Countries in 2021,” the latest research from Pablo Fernandez, Sofia Bañuls, and Pablo Fernandez Acin.

What are ‘reasonable’ requests for business valuation documentation from HMRC?

HMRC have generally argued that, once they reasonably establish an initial case against a taxpayer, the burden of proof passes to the taxpayer—and their financial experts.

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