Noteworthy highlights of the year in BV for 2019
It was a notable year for the business valuation profession in 2019, and BVWire was on the scene each and every week covering all the important developments.
BVLaw Case Update: Kress, Vinoskey plus three more cases that dominated 2019
Join Jim Alerding, a veteran valuator, and Sylvia Golden, BVR’s legal editor, for a discussion of five of the most consequential valuation and damages cases of 2019. This selection of state and federal cases includes the year’s tax decisions that have reframed the conversation on tax affecting, a statutory appraisal case illustrating the Delaware Court of Chancery’s current approach to determining fair value, an ESOP trial court decision that solidifies the DOL’s litigation success, and ...
Highlights of 2019 Delaware Valuation Decisions
This year to date has been another active period for valuation cases in the Delaware courts. Six cases are reviewed and the predominant theme is that, in arm’s-length transactions, appraisal value continues to be based primarily on the transaction price rather than on discounted cash flow.
BVU News and Trends October 2019
A monthly roundup of key developments of interest to business valuation experts.
BV expert shows how to produce a viable valuation with little financial data available
BV expertise matters, as a recent Florida divorce case shows in which the parties’ experts faced the challenge of valuing a company that once operated abroad but was sold a decade before the divorce trial.
Linde v. Linde
Appellate court upholds trial court’s finding that majority shareholder breached fiduciary duty to minority shareholder and buyout order; trial court performed careful valuation analysis finding defense expert’s asset-based approach was “simply an improper method of valuation in the present case.”
Court Says Asset Approach ‘Is Simply an Improper Method’ in Present Appraisal Proceeding
Appellate court upholds trial court’s finding that majority shareholder breached fiduciary duty to minority shareholder and buyout order; trial court performed careful valuation analysis finding defense expert’s asset-based approach was “simply an improper method of valuation in the present case.”
Columbia Pipeline ruling highlights terminal value flaw in expert’s DCF
In the Columbia Pipeline statutory appraisal action, the Delaware Court of Chancery recently rejected the petitioner expert’s discounted cash flow analysis to determine fair value and, in a short but noteworthy discussion, explained why the court has come to question the usefulness of the DCF in many instances.
TAF looking for experts on company-specific risk
The Appraisal Foundation (TAF) is seeking subject matter experts (SMEs) to help develop voluntary guidance on company-specific risk premiums, which it has identified as an area that lacks uniformity in practice.
Deal price prevails in yet another Delaware statutory appraisal ruling
Nine days after his ruling in Columbia Pipeline, Vice Chancellor Laster again found the deal price was the most reliable indicator of fair value in a statutory appraisal case involving a publicly traded mining company.
In re Appraisal of Jarden Corp. (II)
Responding to petitioners’ motion for reargument, court concedes and corrects errors in court’s original DCF analysis but finds corrected DCF model still corroborates the original fair value determination; court affirms its reliance on unaffected market price as fair value indicator.
Court Says Corrected DCF Still Supports Original Fair Value Determination
Responding to petitioners’ motion for reargument, court concedes and corrects errors in court’s original DCF analysis but finds corrected DCF model still corroborates the original fair value determination; court affirms its reliance on unaffected market price as fair value indicator.
Unadjusted deal price best represents fair value, Court of Chancery says
In a statutory appraisal case featuring a publicly traded company, the Court of Chancery, after an exhaustive evaluation of the sale process, found the deal price was the best evidence of fair value.
Business Valuation Terms Need Restructuring Based on Value Drivers
The business valuation profession suffers from a muddling of concepts and terms. It is time to think about a recalibration of valuation terms that grows out of the foundation that has been laid by our original business valuation pioneers.
BVU News and Trends August 2019
monthly roundup of key developments of interest to business valuation experts.
The Due Diligence Imperative in the Era of Value-Based Reimbursement
With the emergence of value-based reimbursement, such as accountable care organizations (ACOs), clinically integrated networks (CINs), and bundled payment models, which rely on achieving the “Triple Aim” of healthcare at lower cost, U.S. hospitals and other service providers are increasingly looking to change how services are being delivered by seeking more collaborative relationships with physicians. The rise of these emerging healthcare organizations (EHOs) to address value-based reimbursement initiatives has led to a growing number of ...
The Appraisal Foundation seeks panelists for the BVRP
Qualified candidates are wanted to serve on the Business Valuation Resource Panel (BVRP) of The Appraisal Foundation.
In re Stillwater Mining Co. 2017 0385 JTL
In statutory appraisal of public company, court relies on deal price; presigning sale process was “suboptimal,” but post-signing market check was “effective”; there was an argument for upward adjustment to deal price based on an increase in the company’s value between merger announcement and deal closing.
Despite Less-Than-Optimal Sale Process, Court Relies on Deal Price for Fair Value
In statutory appraisal of public company, court relies on deal price; presigning sale process was “suboptimal,” but post-signing market check was “effective”; there was an argument for upward adjustment to deal price based on an increase in the company’s value between merger announcement and deal closing.
ASC benchmarking study released
The median EBITDA margin for an ambulatory surgery center (ASC) is 20%, according to the “2019 ASC Benchmarking Survey” from HealthCare Appraisers Inc.
In re Appraisal of Columbia Pipeline Grp., Inc.
In statutory appraisal action featuring publicly traded company, court relies on deal price for fair value; although flawed, sale process, when compared to process in three key high court decisions endorsing deal price, does not undermine validity of deal price; no adjustment for synergies.
Court Endorses Unadjusted Deal Price as Fair Value Indicator Despite Flaws in Sale Process
In statutory appraisal action featuring publicly traded company, court relies on deal price for fair value; although flawed, sale process, when compared to process in three key high court decisions endorsing deal price, does not undermine validity of deal price; no adjustment for synergies.
Court of Chancery favors unaffected market price over other fair value indicators (Part 2)
When the Delaware Court of Chancery recently decided to rely on the unaffected market price for fair value, in a major statutory appraisal case, it provided an in-depth critique of the experts’ traditional valuation analyses, which valuators want to be familiar with.
Lee v. Argent Trust Co.
Court dismisses private plaintiff’s ESOP suit, alleging defendant trustee and other ESOP and company actors violated their fiduciary duties to the plan and overpaid for company stock; a subsequent valuation showed the plan obtained stock at a discount, court concludes.
Court Finds Plaintiff Fails to Show ESOP Transaction Caused Injury
Court dismisses private plaintiff’s ESOP suit, alleging defendant trustee and other ESOP and company actors violated their fiduciary duties to the plan and overpaid for company stock; a subsequent valuation showed the plan obtained stock at a discount, court concludes.