Valuation Discounts

Business Valuation Discounts and Premiums

There is often more money in dispute in determining the discounts and premiums in a business valuation than in arriving at the pre-discount valuation itself. Discounts and premiums affect not only the value of the company but also play a crucial role in determining the risk involved, control issues, marketability, contingent liability, and a host of other factors that can make or break a deal. It is essential that every appraiser know when discounts and premiums apply and how to quantify them.

Shannon Pratt’s Business Valuation Discounts and Premiums compiles all the key information you need to successfully and accurately determine discounts and premiums in business valuations. It explores the three areas of discounts and premiums–income valuation, market valuation, and the asset approach–explaining how different discounts or premiums may be applicable, depending on the basic valuation approach used, and how each approach can affect the outcome.

Filled with many never-before-published studies, the comprehensive coverage includes:

• Strategic acquisitions
• Extensive empirical data
• Pre-IPO marketability discount studies
• Merger and acquisition negotiations, empirical evidence from completed transactions, and positions taken by courts in litigation
• Strategic acquisitions on premiums
• Studies on minority discounts, available for the first time

Written by a recognized authority on business valuation, this book will help you master the complex issues and exploit the numerous uses for premiums and discounts to their utmost.

www.wiley.com

Leading authority Shannon Pratt demystifies discounts and premiums in business valuation

"A must-read! Shannon Pratt continues to add to the business valuation body of knowledge."

-Jay Fishman, FASA

There is often more money in dispute in determining the discounts and premiums in a business valuation than in arriving at the pre-discount value itself. Discounts and premiums affect not only the value of the company, but also play a crucial role in determining the risk involved, control issues, marketability, and contingent liability, to name a few. Approaching a business valuation without a thorough understanding of all the ins and outs of discounts and premiums can cause a deal to topple like a house of cards.

Business guru Shannon Pratt's critically acclaimed Business Valuation: Discounts and Premiums, Second Edition compiles all the key information practitioners need to successfully and accurately determine discounts and premiums in business valuation.

Thoroughly updated throughout, this must-have tool of the trade for business appraisers, accountants, attorneys, and business owners now includes:

• New database chapters that help quantify the discount for lack of marketability
• Analysis of the most comprehensive database, with over 5,000 entries on transactions in minority interests in private company stocks prior to an IPO
• Scores of valuable court case citations
• Court cases covering divorces, gift, estate, income taxes, bankruptcies, corporate and partnership dissolutions, and ESOPs
• Many new, never-before-published studies providing real-world benchmarks that can be applied to the practitioner's own cases

Learn how to master the complex issues of business valuation and capitalize on the numerous uses for discounts and premiums with the help of the most recognized authority on business valuation, Shannon Pratt.

Shannon P. Pratt, CFA, FASA, MCBA, CM&AA, is the Chairman and CEO of Shannon Pratt Valuations, Inc., a premier business valuation firm, and is the founder and Editor Emeritus of Business Valuation Resources, LLC. Over a distinguished career of close to four decades, he has performed valuation engagements for M&A, ESOPs, gift and estate taxation, marital dissolution, shareholder oppression and dissent, and numerous other purposes. He has conducted many fairness and solvency opinions, has testified in a wide variety of federal and state courts across the country, and frequently participates in arbitration and mediation proceedings. Dr. Pratt is one of the most successful and respected authors in his field.

He is the author or coauthor of several industry standards, including The Market Approach to Valuing Businesses, Standards of Value, Business Valuation and Taxes, Cost of Capital, Business Valuation Body of Knowledge, all published by Wiley, as well as PPC's Guide to Business Valuation, Valuing a Business: The Analysis and Appraisal of Closely Held Companies, Valuing Small Businesses and Professional Practices, and The Lawyer's Business Valuation Handbook.