Understanding Control vs. Lack of Control and Applicable Discounts
Please join us for a refresher course on premiums and discounts related to control (or lack of it). Topics covered will include: when discounts for lack of control apply, elements of control, levels of control, what to look for in governing documents regarding the rights of non-controlling owners, developing a non-controlling value directly versus indirectly, control premiums and various sources for premiums and discounts for both operating companies and holding companies, such as Mergerstat, Partnership ...
It’s About Time: Webb on Fractional Interests in Real Estate
After more than 25 years of valuing nonmarketable interests in real estate, Dennis Webb (Primus Valuations) says that the single most important thing in this type of valuation is “time.”
Big IRS red flag in fractional interest valuations
A discussion of who the partners are and what they are likely to do in the future is an essential part of a valuation of a fractional interest in real estate, advises Dennis Webb (Primus Valuations).
Multidisciplinary Blind Spots #5—Time
The single most important thing about valuing an interest in an asset holding company is time: How long will the interest-holder be stuck in its position? Of course, this is also a consideration for a nonmarketable position in any business. But with real estate holding companies in particular, the timing of an exit event is the single most important variable affecting value. It’s just not an easy story to write. This webinar will provide keys ...
BV News and Trends April 2022
A monthly roundup of key developments of interest to business valuation experts.
Gary Trugman shares sample valuation reports
A good selection of eight sample valuation reports is available on the companion website of Gary Trugman’s book, Understanding Business Valuation, 6th edition.
Whatever Happened to Specific Company Risk? Accounting for Management Risk in Private Partnerships
Multidisciplinary valuation projects set many traps for the unwary. Join Dennis Webb to learn about one such trap that affects virtually every asset holding company valuation because the real property appraiser and business valuer usually don’t know what the other needs. For specific company risk, such an omission can be quite a big deal.
New book on valuing fractional interests
For almost 25 years, valuing fractional interests involving real estate has been the specialty of Dennis A. Webb (Primus Valuations).
Non-Marketable Investment Company Evaluation: Free Resource for Your Next Valuation
When it comes to valuing minority interests in family investment entities such as family limited partnerships, it is apparent that the income approach should now be used alongside the traditional asset/market approach. Join creator William Frazier for a live “nuts and bolts” example of exactly how the nonmarketable investment company evaluation (NICE) method is used. With examples of FLPs with different asset makeups and financial characteristics, this event will arm you with a new tool ...
Items of Interest Gleaned From the ASA Conference Networking Ops
BV firm staffing troubles, Shannon Pratt’s video remarks about his new book, a new app for fractional interests, a heightened interest in businesses with a real estate component, and help needed in developing a new module for the Cost of Capital Navigator are just some of the things we learned outside the regular sessions at the ASA conference—in and around the exhibit hall and during the many networking breaks.
BV News and Trends November 2021
A monthly roundup of key developments of interest to business valuation experts.
Valuing Marketable Securities Portfolios
Given the expected reduction in the estate tax exemption, the use of privately-held marketable equity securities (MES) portfolios as a wealth transfer vehicle is likely to increase. Join Gary Gerlach to learn the ins and outs of valuing these investment vehicles. We will cover the use of multiple (free) sources of closed-end mutual fund (CEF) data and discounts and analyze and select guideline CEFs, focusing on metrics such as asset type, concentration and allocation issues ...
New online tool for valuing fractional interests
This October will see the launch of the Partner Value Expert (PVX), an online application that represents a new approach to valuing fractional interests involving real estate.
Decoding the Cross-Professional Maze: A Guide to Persuasive Real Estate-Related Valuations
Key disconnects between the real estate and business valuation professions that can blow up holding company and other real estate-related valuations. Join Dennis A. Webb to learn about the built-in conflicts between real estate appraisal and business valuation. Do you think that the two related professions would have a common understanding of valuation premises, use of data, and the appraisal process generally? They don’t. Misunderstandings and blind spots affect valuations of pretty much any business ...
LLC buyout at fair value poses ‘conundrum’ for the court
In allowing LLC members to buy out a departing member to avoid the dissolution of the company, a court had to determine the fair value of the departing member’s interest in a holding company.
Finkel v. Palm Park, Inc.
In LLC member dispute, court faces “conundrum” where fair value buyout seeks to avoid LLC’s dissolution and court leans on expert’s FMV valuation using net asset value approach premised on “orderly liquidation”; court notes FMV is based on hypothetical actors and transaction, not specific parties.
Court’s Fair Value Determination Leans Heavily on Expert’s Fair Market Valuation Premised on Liquidation
In LLC member dispute, court faces “conundrum” where fair value buyout seeks to avoid LLC’s dissolution and court leans on expert’s FMV valuation using net asset value approach premised on “orderly liquidation”; court notes FMV is based on hypothetical actors and transaction, not specific parties.
Appeals Court Upholds Grocery Store Buyout Ruling and Fair Value Determination
Appeals court upholds district court’s buyout order of minority shareholder’s interests in related family businesses (grocery store chain) as well as district court’s fair value determination; district court’s valuation “falls squarely” between trial experts’ valuations, appeals court says.
Lund v. Lund (II)
Appeals court upholds district court’s buyout order of minority shareholder’s interests in related family businesses (grocery store chain) as well as district court’s fair value determination; district court’s valuation “falls squarely” between trial experts’ valuations, appeals court says.
Matter of Levine v Seven Pines Assoc. Ltd. Partnership
In partnership dispute, New York appellate court, citing precedent, approves of use of marketability discount in fixing the fair value of the limited partner’s interest in real estate holding company; however, court rejects use of a minority discount.
New York Court Validates DLOM in Real Estate Holding Company Valuation
In partnership dispute, New York appellate court, citing precedent, approves of use of marketability discount in fixing the fair value of the limited partner’s interest in real estate holding company; however, court rejects use of a minority discount.
In Big Buyout Ruling, Minnesota Court Rejects DLOM in Calculating Fair Value
In a forced buyout, court says experts were too partisan to their clients, compromising value analysis; court performs its own valuation using DCF to determine fair value of grocery business and rejects DLOM because no unfair transfer of wealth occurs.
Kassab v Kasab
In determining the fair value of petitioner’s interest in two family businesses that hold real estate, New York court (Second Department) adopts expert’s decision not to apply marketability discount, noting valuation “already relies upon market exposure.”
Court Adopts DLOM-Free Valuation of Realty Holding Company
In determining the fair value of petitioner’s interest in two family businesses that hold real estate, New York court (Second Department) adopts expert’s decision not to apply marketability discount, noting valuation “already relies upon market exposure.”
NAV Alone Fails to Capture Distributional Interest’s Fair Value
Appellate court affirms fair value determination of distributional interest in family farm based on multiprong valuation; company is not a holding company, and net asset valuation alone fails to capture fair value of dissociating members’ interest.