Case Studies: Valuations

Kenrich Retained To Provide Testimony On A Breach Of Fiduciary Duty Engagement By A Multi-Billion Dollar Automotive Company

Kenrich personnel were retained by counsel for a multi-billion dollar automotive company to provide testimony related to a breach of fiduciary duty matter. In this instance, the plaintiff was alleging that the minority shareholder was not properly compensated for their equity portion of the company at the time of a transaction. Our work included:

  • Analyzing historical financial results to develop trends related to revenue growth, profit margins, capital expenditures, and working capital requirements.
  • Creating discounted cash flow models based on management’s projections, industry analysts, and historical results.
  • Developing an equity cost of capital which reflected the risk profile of the company.
  • Reviewing comparable publicly traded “guideline companies” stock price levels to calculate valuation multiples with application of appropriate premiums and discounts.
  • Analyzing contemporaneous transactions to determine multiples paid for similar companies.