Fairness Opinions

Even the appearance of a conflict of interest can be a deal-killer, especially in situations involving major equity and/or debt transactions. It may even lead to litigation, an outcome no party to a deal generally relishes. The most effective proactive strategy to prevent that from happening is to obtain a fairness opinion before completing certain transactions.

A fairness opinion provides an independent objective analysis of a proposed deal’s financial aspects from the point of view of one or more of the parties to the transaction. Any number of factors in deals involving both public and private companies can trigger the need for a fairness opinion. These documents are frequently used to protect the interests of company directors, stockholders, investors and involved parties with any kind of fiduciary responsibility. Fairness opinions are often requested in deals involving public offerings, leveraged buyouts or major refinancing/restructuring.

Appraisal Economics has the personnel, expertise and research resources to provide the assurance of fairness to participants which these types of deals require. We are highly experienced in mergers, acquisitions, divestitures and related services. We have worked on many such transactions, both domestically and internationally. A fairness opinion from Appraisal Economics is the product of a comprehensive analysis that includes a thorough review of the terms and structure of the proposed transaction.

Tight deadlines and rapid turn-around are never a problem for Appraisal Economics. The combination of experience, in-depth analysis and sterling credentials we bring to a fairness opinion can help to discourage challenges from third parties. Not surprisingly, a wide range of both public and private corporations and board of directors regularly call on us to provide them with independent fairness opinions regarding acquisitions, divestitures, management buyouts and similar major transactions.

A sampling of the kinds of transactions in which Appraisal Economics has rendered fairness opinions includes:

• The acquisition of a health care company specializing in the insurance of doctors
• A non-compete agreement included in the $1 billion acquisition of a major franchise organization
• The acquisition of a manufacturing company which produces components for the wireless communications industry
• The acquisition of an individual product line in the pharmaceutical industry
• The acquisition of a hotel chain which included a number of casinos