case Valuation of a minority interest - jbr-consultancy.com

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Valuation of a non-controlling interest

Mission

JBR was asked for a "second opinion" regarding a valuation of the company and its subsidiary by a third party, acting on behalf and for the account of two shareholders of an engineering firm, active in energy-related projects.

Background

The company has three shareholders. One shareholder is in dispute with the other two shareholders. This shareholder has since ceased to work for the company and wishes to sell his one third of the outstanding shares to the other two (remaining) shareholders.

Problem statement

The shareholders could not agree on the price of these shares and went to court. The court appointed three professional valuers (one appointed by each of the parties and one independent) to determine the price of the shares in accordance with the company's articles of association.

Our contribution

We acted on behalf of the two (remaining) shareholders and gave a second opinion on the valuation of the appraisers appointed by the court.

The result

We have succeeded in lowering the valuation, resulting in a lower purchase price for our customers, mainly based on arguments regarding the required future investments to be made by the company.