Valuations, Fairness Opinions, and More — For Business in Canada and Abroad

The current deal environment is characterized by an intensified focus on accountability of the board of directors and increasing transaction structure complexity. MPA’s professionals have helped boards and special committees strengthen their fiduciary oversight and make more informed decisions by providing an independent valuation and fairness opinion based on rigorous transaction analysis and sector knowledge.

A fairness opinion is a report from an advisory team that evaluates a merger, buyback, acquisition, or other types of business purchases. This report evaluates the facts and provides an opinion on if the deal is fair for one or multiple entities involved.

Fairness opinions are crucial in the business world because they provide an objective opinion based on collected data and analytical expertise. These opinions provide valuable insights to buyers or sellers when they make the final decision on their merger, buyback, etc. 

Since the widespread use of fairness opinions, there have been objections to the practice. For example, many analysts used questionable methodologies to arrive at their evaluations. Furthermore, conflicts of interest led to favorable valuations depending on which side of the transaction the valuation is commissioned from.

Fairness opinions aren’t necessary for every single transaction, but they are generally recommended for most deals or transactions. Fairness opinions are always obtained for public companies because of the near-certainty of a lawsuit. If your transaction is relatively small, then you may be able to forgo a fairness opinion or valuation. For most deals, it is better to have a fairness opinion rather than not.

• Mergers
• Acquisitions
• Buybacks
• Fair Value of Minority Interests
• Related Party Transfers
• Privatization

For transactions large and small, you will want qualified, solid reporting and valuation reports. At MPA, we understand how small errors in analysis can lead to massive changes in outcome. For a team solely focused on your business’ success, contact us today!