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Reasons To Value A Business

The valuation of a business is not just for a business owner preparing for a sale. In fact, there are numerous business and legal situations that require a detailed valuation. Sun Business Valuations, LLC provides valuation services for a variety of purposes. Client’s typically seek to value a business in regards to:
By taking steps early on to value a company, you establish a reasonable starting point for discussion between all parties seeking a fair and amicable agreement.

Shareholder and Partnership Buyouts and Disputes

Partner/shareholders may decide to exit a partnership or offer an equity position to someone else. Proper third-party valuation and facilitation services can result in a fair and amicable transaction.

Merger & Acquisitions / Business Sales

If considering the acquisition or sale of a business, or portion thereof, valuation of a business is a critical tool. In typical mergers, an independent market valuation of each company is a requirement to determine equity distribution. A valuation can serve to bridge any discrepancy in the two party’s opinion of value and provide a reasonable starting point for discussion.

Buy-Sell and Shareholder Agreements

Many buy/sell agreements require a business valuation so that ownership will be transferred at fair market value. Agreements between partners or shareholders (i.e. a buy-sell agreement) should be based upon a business appraisal rather than a simple formula. The formula approach may yield an unrealistic value, if there is a substantial change from the time of drafting to implementation. A valuation enables cross benefit life insurance requirements to be more readily determined.

Marital Dissolution

A business is typically the largest joint marital asset and the most difficult to value. A business valuation will either be court appointed or voluntarily engaged to value a business and facilitate an amicable and equitable distribution settlement.

Commercial Litigation

Economic damages often need to be assessed in commercial litigation proceedings. Sun can provide dispute resolution by providing facilitation and valuation services in a variety of situations.

Estate & Gift Tax

Gifting of closely held stock and partnership/LLC interests requires an independent valuation, to provide an objective, defensible analysis and certification as to the fair market value of the business at the time of the ownership transition.

Minority Shareholder Disputes and Litigation

Situations can arise when a minority shareholder is not receiving any dividends or other return on his or her investment in a closely held company; and majority owners are receiving substantial sums benefits from the company. In this type of litigation, a comprehensive valuation is a necessity.

Financing

Increasingly, lenders will request an independent market valuation prior to approving a small business loan or credit line. It is a valuable tool to include in a loan package when approaching the lender.

Analysis and Critique of Opposing Expert’s Business Valuation Reports

A critique report will identify and analyze what is correct, incorrect, missing and/or misinterpreted in an opposing valuation expert’s report. The valuation critique can identify specific issues or provide an overall opinion as to whether the report being critiqued is in fact reasonable. It is useful for an attorney to have a critique report of a valuation report prepared by the opposing side.

Conversion of a “C” Corporation to Subchapter-S Corporation Status

Businesses that are planning to convert from “C” to “S” or “LLC” corporate status should have a valuation done as of the date of the change. If the firm is sold prior to the ten year holding period, there is a tax due on the built-in gain of value from the point of conversion. An independent valuation as of the date of the conversion substantiates the tax calculation for the IRS.

Personal Financial Management

A business represents a typical owner’s single most valuable asset. Despite this, most business owners have no realistic concept of the true market value. A valuation enables informed critical decisions, such as proper timing to pursue an exit strategy.

Financial and Tax Reporting

Certain financial and tax reporting situations require qualified, independent valuation services. When a company issues stock options, or transfers or sells equity interests, a valuation is required for the company to accurately report related compensation expense and the recipients to accurately report income.

Want To Know The Value Of A Business? Call Us Today.

Knowing the value of a company is essential. Call us toll free (800) 232-0180 to speak with a certified Valuation Analyst who will answer all your questions and explain how convenient and confidential it is to have Sun Business Valuations prepare an appraisal for your business.

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What Our Clients Are Saying...

"We have used Sun Business Valuation's services for a half dozen shareholder disputes that our clients have been involved in. Sun's ability to document the fair market value of a firm and provide detailed back-up that supports their findings has been invaluable in settling these disputes."

Richard Lambert

Dunn Lambert LLC

"I was impressed with the knowledge that Stephen and Jessica had about my industry. They knew exactly what questions to ask in order to address key elements that drive value within the firm. Once the report was complete, they reviewed the report in detail with us so that we understood every aspect of the methods utilized. Sun provided an invaluable service to us and I would gladly recommend them to other business owners in need of a valuation for any purpose."

Bob Shickler

Brunswick Automotive Associates

"Our Company hired Sun Business Valuations to determine the fair market value of our stock. Sun's team took us through a detailed questionnaire to fully understand all aspects of our operations and uncover the intangible risk factors and value drivers. Sun identified areas in which our firm needed improvement and the elements that separated us from our competitors. The valuation served as a good check point for our management team to understand the health of our business and plan for future growth."

Chris Connell

Hudson Heating Wholesaler Inc.

"I had a silent partner that we needed to buy-out. We had been banging heads for months as my former partner was insisting on an outlandish value. Sun's ability to prepare an understandable valuation using a wide variety of valuation approaches and supporting the conclusions was the key to getting our buyout resolved."

Dan Sormani

Lifelong Friendship Society

"Sun makes sure to put the needs of their clients as a top priority. All engagements begin by understanding each client's specific valuation need, keeping special circumstances in mind, and always providing a detailed and thorough report in a timely fashion. I would recommend Sun's services without reservation."

Donald Burnaford

Senior Partner, Creative Financial Group of New Jersey

"I requested the service of Sun for a shareholder buy-in. I was impressed right from the start with my initial conversations with Sun's valuation team. They explained the process to me in detail, clearly conveyed what information I would need to provide, and were willing to make themselves available to fit into my hectic schedule. Sun's careful and detailed analysis provided me with the tools I needed to move forward with my business' evolving structure."

Joseph Scialo

Scialo Reimann & Associates, CPA

"I know my clients are in good hands with Sun. They always work directly with management and certified valuation professionals. Sun's certified valuation team walk each client through a detailed questionnaire and take the time to review company financials in depth."

Dan Swick, Herrick Feinstein

"Sun has prepared numerous valuations for my clients over the years. When I entrust Sun with my client's valuation needs, they make a detailed process seamless and inform every one of the step by step process business valuations require. My clients have always been at ease when working with Sun and I highly recommend their work."

Charles Damian, Esq.

"We work with many of our clients in developing Stock Incentive Programs to help retain key management. Sun has conducted many valuations for my clients for this purpose over the past 3 years and in all cases our clients were very appreciative with their work."

Kurt Olender

OlenderFeldman LLP

"We used Sun to determine the valuation of our firm to attach to our certificate of value in our partnership agreements. We had Sun present the valuation report to our entire management team. It helped us all get on the same page. We even agreed to have Sun update the valuation for us on an annual basis."

Robert Hogg

Managing Director, Ancero, LLC

"I have used many valuation firms and have never found a company that provides the custom service level of Sun Business Valuations. While many firms create boiler plate templates, Sun composes detailed and individually tailored reports that truly capture the valuation purpose at hand. I will continue to use Sun for my client's valuation needs."

Robert Martini

Martini Law, LLC