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Business Valuation Insights
Business Valuation: Step one in the sale process.
May 5, 2015 / in Business Valuation, Exit Planning, Sell a Business / by Louis Cionci
If you are considering selling your business, I would like to let you in on an M&A (merger and acquisition) professional’s insight. I have been involved in initiating and managing M&A transactions for over 15 years and have handled deals representing over $250 million in transaction value. Those transactions ranged from $2.6 mm to $90 mm. In addition, I was on a team that helped an international client acquire a $2.6 billion industry rival back in …
Valuation: Theory, Practice and Reality
March 11, 2015 / in Business Valuation, Exit Planning / by Exit Strategies
I attended a luncheon last week where a private equity firm’s panelist claimed that business valuation is too theoretical and inappropriate in the transactional world. I instinctively question broad-based statements like this, when I hear them; however I listened attentively. The panelist correctly asserted that most valuation firms focus on compliance and litigation work as opposed to transactions. However, his criticism of valuation work was illogical and inconsistent, and offered no better alternative. To make …
Your Buy-Sell Agreement: In good shape? Needs a tune up? Or Disaster waiting to happen?
February 25, 2015 / in Business Strategy, Business Valuation, Buy-Sell Agreements / by Bob Altieri
An Ounce of Prevention is Worth a Pound of Cure I can’t tell you how many times I’ve heard from business owners and their spouses that a key person became disabled or died and left an operating closely-held business in turmoil. What, no Buy-Sell Agreement? Ask anyone who has been selling and appraising business for a number of years and they will tell you this sort of thing is common. All businesses with more than one shareholder should have …
Court Chastens Expert Over Deficient Business Valuation
February 18, 2015 / in Business Valuation / by Al Statz
Sometimes courts face a hard choice, having to decide between equally compelling and competent valuations. Not so in a recent fair value proceeding in which the skills gap between the testifying experts made it easy for the court to pick the winner. Use of the Valuation: Business Divorce The petitioner and the respondent were the two owners of a New York company that installed solar energy panels on buildings. Business boomed, and the company enjoyed …
Upcoming Event: Valuing a Business for Estate Purposes
November 17, 2014 / in Business Valuation, News / by Al Statz
Society of California Accountants North Bay Chapter Annual Estate & Trust Update At the Sheraton Sonoma County Click here for enrollment information. My background as a business valuation expert, M&A advisor, corporate development executive and business owner allows me to bring a wealth of knowledge and first-hand experience to closely held and family business owners as they consider their exit options and plan successful ownership transfers. I enjoy educating business owners on these topics, and sharing my expertise with accountants, attorneys, lenders …
The Importance of a Credible and Competent Valuation Expert
September 30, 2014 / in Business Strategy, Business Valuation / by Al Statz
The need for business valuation arises in many circumstances ranging from dispute resolution, to estate planning, to the sale of a business to name only a few. As in all professional disciplines, it is important to hire a practitioner who is fully trained, able to discern relevant facts, and abreast of current best practices. Consider the following New York Supreme Court case.* Adelstein v. Finest Food Distributing Co Two brothers and their uncle each owned …
Upcoming Event on Valuation of Ag and Food Businesses
April 25, 2014 / in Business Valuation, News / by Al Statz
Al Statz of Exit Strategies Group will be a panelist for the American Society of Appraisers (ASA) Northern California workshop —Working with a Going Concern: Valuation Issues Related to Ag-Food Processing Facilities, on Saturday, May 31, 2014, in Fairfield, California. A Message From Al: My passion is helping baby boomer business owners exit right and retire well. My background as a valuation and M&A professional, business owner and corporate development executive allows me to bring a wealth of knowledge …
Is it too early to have my business valued?
April 22, 2014 / in Business Valuation, Sell a Business / by Roy Martinez
A potential client has been dragging his feet on having a business valuation done. Most recently, he asked, “Is it too early to have my business valued?” A better question may be, is it too late? This baby boomer wants to exit his business and retire in the next 2-5 years. He said, if the business isn’t worth much, he would probably hold on to it and transition management of the business to a group …
What is Fair Market Value?
April 2, 2014 / in Business Valuation / by Al Statz
You’ve heard the term Fair Market Value many times. Fair Market Value is indeed the most common standard of value used in business valuations, but what does it actually mean? Fair Market Value is typically defined as “the price at which the property would change hands between a willing buyer and a willing seller, when the former is not under any compulsion to buy and the latter is not under any compulsion to sell, both …
Why Should I Only Retain a Certified Valuation Expert?
March 17, 2014 / in Business Valuation / by Jim Leonhard
If you’re thinking of using a non-certified or non-credentialed individual to value a business, consider the following recent judicial ruling. The United States Tax Court ruled on February 11, 2014** that a valuation conducted by a non-valuation credentialed individual used for an estate tax filing was materially deficient. The individual who prepared the valuation was both a CPA and a CFP (certified financial planner), had written 10-20 valuation reports, and had testified in court. However, …