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Case studies - Valuations
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When a European company acquired three non-EU power distribution companies, it needed independent valuations to meet new accounting standards (IFRS3).
We acted as project managers, and performed the extensive valuations required: this included valuations of fixed assets (plant, machinery, land), intangible assets such as brands and power purchase agreements, and other financial and non-financial assets and liabilities in the balance sheet.
The client was undertaking a tax planning exercise with our international tax group, the success of which would be determined by the valuation of the intellectual property.
By gaining a thorough understanding of the client's business, and the market in which they operated, our Valuations team undertook a robust valuation of the brand using forecast and historical financial data and factoring in existing risks.
Our client was able to use this valuation to considerably reduce their future tax liability.
We were appointed as an expert witness for a company that held a 50 per cent interest in the second-largest gold mine in Eastern Europe. We worked closely with mining engineers to determine the exact risks associated with mining the site.
Our team was also involved in cross examination at the London Court of International Arbitration.
The difference in the contested valuations was $750 million, with the London Court of International Arbitration finding in favour of our client on all counts -- and also in favour of our client’s counterclaim.
Our litigation support team was instructed to provide forensic services in connection with a disputed commercial transaction. An integral part of this process was the requirement to consider the value of a controlling interest in a non-EU business.
The work entailed producing an expert witness report for the purposes of an international arbitration in Switzerland. The value of the interest may be exemplified by the fact that the shareholding concerned is an integral part of a substantial minority shareholding in a larger entity which is considered to have a potential float value in the order of $2bn.
Company A was a joint venture company equally owned by a UK quoted entity and a US quoted entity. As a result of a change in control in one of the companies, there was a requirement to determine the value of the joint venture company, which was involved in projects related to the Government’s PFI policy.
The valuation ‘gap’ between the two entities was in excess of £150m. We were instructed to assist in arriving at an independent opinion of value of Company A, and were able to provide a definitive value at which the interest of one party was transferred to the other.
Following the death of a famous author, there was a question of domicile in his last years, with the Inland Revenue seeking back duties. This was particularly relevant as a film based on one of his books had been successfully released in the year before his death.
We presented the case to the Revenue, and provided valuations of the copyright in the author's books and the film rights. Our negotiations with the revenue reduced the anticipated tax liability by 50 per cent.
We were appointed by the Court to value a major business under a S459 Petition as a Single Joint Expert. With the Court’s authority, we adopted a specific process to achieve an outcome acceptable to all sides. We were praised by both parties in respect of the fair and open manner in which we had approached this extremely acrimonious dispute that had remained unresolved for many years.
The web site contains illustrative case studies. The names, place names and corresponding details of these case studies have been changed in order to protect the confidentiality of our clients and others and these details are purely fictional. BDO Stoy Hayward does not intend them to refer to or portray (in name or substance) any actual names, companies, businesses, entities or institutions. Any resemblance to any real person, company, business, entity or institution is purely coincidental. |