Here are just some of the many business valuation cases handled by StoneBridge Business Partners’ professionals:

Tax-related valuations

• Referred by an estate planning attorney to value a family-owned manufacturing business. The controlling shareholder made a gift of non-voting shares to a newly established Grantor Retained Annuity Trust (GRAT) and sold his voting shares back to the company utilizing a Self-Cancelling Installment Note (SCIN). We assisted with the estate and succession planning as well as provided the business valuation.
• Performed valuations of an ambulatory surgery center (ASC) and a related management services organization (MSO) for income tax purposes, related to the sale/transfer of shares of the MSO to a third party. The sale/transfer of the ASC occurred one year later.
• Referred by a corporate attorney to value a manufacturing business owned by a private equity fund for purposes of a corporate restructuring. The company was heavily reliant on one customer and had been experiencing increasing pricing pressures. The company’s financial outlook was expected to be much different than its immediate past.
• Performed a valuation of a family limited partnership, with various office properties as its major holdings. The purpose of the valuation was to arrive at a value for gift tax purposes.
• Conducted a valuation for a company that performs daily recordkeeping services for retirement plans for more than 80 financial organizations throughout the U.S. There was tremendous growth potential and a possible strategic sale within 10 years. The valuation determined the built-in gain for S-Corporation election purposes.
• Performed a valuation of a non-marketable minority interest in an LLC for a taxable gift, which included marketable securities and residential real estate. The IRS audited the gift tax return and we defended its valuation discounts.
• A valuation was performed for a gift made to a Grantor Retained Annuity Trust (GRAT). The business involved a dealer of equipment, which had substantial restrictions placed on it by the manufacturer.

Shareholder liquidity valuations:

• Referred by an attorney and CPA to value a family-owned packaging manufacturer, with multiple business entities, for purposes of the sale of the controlling shareholders’ interest to the owners’ children at an arms-length price.
• Referred by an investment banker to provide a valuation for a corporate training business for purposes of buying out numerous minority shareholders.

Corporate transaction services

• Retained by a Fortune 500 company to perform a valuation for a proposed joint venture between one of its subsidiaries and an established Japanese company. The purpose was to determine the value contributed by each party to the joint venture.
• Performed a valuation of a computer consulting and training company that specializes in providing customized programming services for its clients. The significant valuation issues revolved around the company’s rapid growth, high profitability and management’s key participation in the business.

Accounting-related valuations

• Prepared a purchase price allocation for financial reporting under FASB Accounting Standards Codification (ASC) 805, Business Combinations. The engagement included recognizing and measuring all identifiable assets acquired and liabilities assumed, recognizing and measuring goodwill, and determining if there was a gain from bargain purchase. Identifiable intangible assets included trademarks, non-compete agreements, a customer list, technology and a web site.
• Referred by a CPA firm to determine the fair value of share-based payments to employees and independent contractors for financial reporting in accordance with FASB Accounting Standards Codification (ASC) 718, Compensation – Stock Compensation. Since the Company was privately held, the engagement involved calculating the value of preferred stock and common stock and using the volatility of publicly traded guideline companies’ stock as a proxy for expected volatility of the Company’s stock in the options-pricing model.
• Performed a valuation of the fully-diluted common stock of an early stage, high technology company, to assist management in the determination of the fair market value of share-based payments to employees and independent contractors, in accordance with Internal Revenue Code Section 409A. The Company had a complex capital structure and a limited operating history.