Dependable valuations for reliable opinions.
The business and legal communities rely on accurate and reliable business valuations in the following areas:
Shareholders’ agreements and/or shareholders’ disputes
Specific provisions in a shareholders’ agreement calling for a valuation can help companies avoid costly and disruptive shareholder disputes.
Where shareholder disputes do arise, a professional valuation can help resolve the dispute thereby avoiding litigation. If the dispute cannot be resolved outside the Courts, our valuations will provide objective, independent evidence leading to a fair and equitable decision with respect to value.
Mergers, acquisitions and divestitures
Business combinations often start with a valuation to provide an indication of price that allows for the development of a proper buyout or acquisition strategy. This process leads to the quantification of potential synergies and identification of business risks and opportunities, increasing the likelihood of a successful transaction. A business valuation will also help identify value drivers and will help shareholders measure the impact of strategic initiatives with a view of maximizing the value of their business today and in the future.
Major transactions involving the shares of publicly-traded companies often require the preparation of fairness opinions or formal business valuations pursuant to regulatory requirements. These reports are invaluable to company directors and independent committees in fulfilling their responsibilities to their companies’ shareholders.
Other situations, involving either public or private companies, lenders, creditors and other stakeholders may require an independent and objective assessment of a proposed transaction or the company’s fair market value. Our analysis will be tailored to the specifics of the situation to provide the stakeholders with the information they need to make the right decisions.
Financial Reporting Requirements
Subsequent to a business acquisition, financial accounting standards require companies to restate their assets and liabilities acquired to fair value. This requires the identification and valuation of the company’s identifiable intangible assets and determines the residual value of goodwill acquired in the acquisition.
Our team can also assist with the required impairment tests of the carrying value of intangible assets and goodwill.
Income tax—estate freezes, corporate reorganizations and compliance
Corporate reorganizations, including estate planning and other special situations such as transfers between related parties, require taxpayers to determine the fair market value of their assets. Our practical valuation approach is tailored to the risk inherent in the contemplated transaction or situation and meets or exceeds the standards of the Canada Revenue Agency and the Internal Revenue Service.
In most cases, the dissolution of a marriage requires the valuation of the business interests held by each party. In addition, there may be a need for income analysis, to establish the actual or potential earnings of each spouse and its effect on support payment calculations.
Employee share purchase and option plans (ESOPS)
ESOPS – including employee share purchase plans, employee stock option plans, and more creative vehicles, such as phantom stock plans – are becoming increasingly common. The plans present special valuation challenges for purposes of their administration, for preparation of the financial statements of the issuing company, and for proper tax planning for the beneficiaries (the employees).
Richter has extensive experience in mergers, divestitures, acquisitions and financing of businesses. This real-market experience means we deliver realistic, supportable valuations. Equally importantly, we keep our valuations grounded in the "real world."