A fairness opinion provides an independent objective analysis of the financial aspects of a proposed transaction from the point of view of one or more of the parties to the transaction.
They are often used to protect the interests of company directors, stockholders, investors and involved parties with any kind of fiduciary responsibility. While fairness opinions can not only help avoid disagreements among the individual stakeholders or between stakeholders and the Board, a fairness opinion is often necessary for a Board to have fulfilled their fiduciary duties.
Mercer Capital leverages its historical valuation and investment banking experience to help clients navigate a critical transaction, providing timely, accurate and reliable results. We have significant experience advising boards of directors, management, trustees, and other fiduciaries of middle-market public and private companies in a wide range of industries. Our independent advice withstands scrutiny from shareholders, bondholders, the SEC, IRS, and other interested parties to a transaction, and we are well-versed in the new industry standards regarding fairness opinions issued by FINRA in late 2007.
A variety of factors in transactions involving both public and private companies can trigger the necessity for a fairness opinion, including:
- Merger or sale of the company
- Sale of subsidiary businesses, or distinct lines of business
- Recapitalizations
- Stock repurchase programs
- Squeeze-out transactions
- Spinoffs, spinouts, or split-ups
- Certain ESOP-related transactions
- Other significant corporate events