Shareholder Dispute

Valuation of Shareholder Interest for Settlement of an Estate

Business Valuation Accepted by Arbitrator

Situation

A stakeholder of an automobile dealership passed away and the company needed a valuation for the settlement of the estate. Each party involved, the company and a family member for the estate, hired professionals to prepare individual business valuations that were to be reviewed and decided by the American Arbitration Association of Boston.

The family member hired an ‘industry expert’, a CPA specializing in the automobile industry. The company hired Merrimack Business Appraisers, a firm focused on preparing and presenting detailed business valuations across industries, including automobile dealerships.

Merrimack Business Appraisers’ Approach

  • Lou Pereira prepared a thorough and detailed valuation of the business and the value of the fractional ownership for the shareholder to settle the estate.
  • The detailed valuation report, exceeding one hundred pages, was reviewed and presented to the arbitrator as part of the proceedings to substantiate the valuation.
  • The CPA prepared a two page written analysis of the shareholder valuation.

Valuation Outcome

The brief valuation prepared by the accountant was disregarded by the arbitrator. The business valuation and associated stakeholder valuation prepared by Lou Pereira of Merrimack Business Appraisers was accepted by the American Association of Arbitration as the value to settle the estate.

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Why Merrimack Business Appraisers?