Business Valuation For Legal Actions

As a business owner or owner of an equity interest in a business, you may encounter any number of situations where you will require valuation services to determine value for use in divorce proceedings, damage actions for business losses or shareholder dissent, to name a few general situations. The following links provide more details regarding valuation services offered by Convergent Capital Appraisers.

The standard of value to be used in a dispute case is both interpreted and defined by respective state court case precedents and law. For divorce cases in the State of Texas, the standard of value is Fair Market Value, described as "the value of an asset is its fair market value unless it has no market value. Fair Market Value means the amount that would be paid in cash by a willing buyer who desires to buy but is not required to buy, to a willing seller who desires to sell but is under no necessity of selling.

For shareholder dissent cases under Texas law, the standard of value is Fair Value - the procedure and definition of which is outlined in Section 10.362 of the Texas Business Organizations Code (TBOC) as follows:

"The fair value of the shares shall be the value thereof as of the day immediately preceding the meeting, excluding any appreciation or depreciation in anticipation of the proposed action. In computing the fair value of the shares under this article, consideration must be given to the value of the corporation as a going concern without including in the computation of value any control premium, any minority discount, or any discount for the lack marketability."

This Section of the TBOC makes clear that valuation practitioners performing valuations, for the purposes of dissenting shareholders, should not apply premiums or discounts to the measurement of fair value.

Why Choose Convergent Capital Appraisers?

In the event that you are involved in a pending divorce or litigation case that involves business ownership or damages to a business, our professionals have the experience, skill and attention to detail to determine applicable regulations, the valuation approaches and methods that are best suited to your specific circumstances; and the understanding of how to bring all the relevant factors together to develop an accurate and defensible value conclusion.