Divorce Settlement

The Value of Personal Goodwill in a Divorce Settlement

Business Valuation Saved $500,000

Situation

The owner of a $1.8 million professional services business was going through divorce proceedings and sought to retain an expert to determine the fair market value of the business and related marital asset. With an impeccable track record of providing complete, highly detailed, and fully defensible valuations, Merrimack Business Appraisers was retained by the owner for business valuation services.

Merrimack Business Appraisers’ Approach

Lou Pereira, Merrimack’s president, developed a detailed business valuation report that identified and substantiated that $1 million of the business value was attributable to personal goodwill of the managing owner, and not a marital asset. Pereira applied a multi-variable analysis that qualified and quantified the amount of personal goodwill.

Valuation Outcome

As a result of Merrimack’s business valuation, the business owner saved approximately $500,000 in unjustified allocation in the divorce settlement.

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