Corporate Valuation, Investment Management

June 29, 2020

Whitepaper Release: Valuing Independent Trust Companies

If you’ve never had your trust company valued, chances are that one day you will.  The circumstances giving rise to this valuation might be voluntary (such as a planned buyout of a retiring partner) or involuntary (such as a death, divorce, or partner dispute).  When events like these occur, the topic of your firm’s valuation can quickly shift from an afterthought to something of great consequence.

The topic of valuation is of particular importance to owners of independent trust companies given the typical independent trust company’s ownership structure, where a majority interest is held by the firm’s founders or senior partners, with younger, more junior partners holding smaller stakes.  Such an ownership dynamic—with its (relatively) frequent arms-length transactions and potential for ownership disputes—heightens the need to understand the value of your ownership interest.  In our experience working with independent trust companies on valuation issues, the need for a valuation is typically driven by one of three reasons: shareholder agreements, transactions, or litigation.

The situation giving rise to the need for a valuation could be one of the most important events of your professional career.  Familiarity with the various contexts in which your firm might be valued and with the valuation process and methodology itself can be advantageous when the situation arises.  To this end, we’ve prepared a whitepaper on the topic of valuing interests in independent trust companies.

In the whitepaper, we describe the situations that may lead to a valuation of your firm, provide an overview of what to expect during the valuation engagement, introduce some of the key valuation parameters that define the context in which a firm is valued, and describe the valuation methods and approaches typically used to value independent trust companies.  If you own an interest in an independent trust company, we encourage you to take a look.  While the value of your firm may not be top of mind today, chances are one day it will be.  Our hope is that this whitepaper will provide you with a leg up towards understanding the valuation process and results, and further that it will foster your thinking about the valuation of your firm and the situations—good and bad—that may give rise to the need for a valuation.

 

cover_Mercer-Capital_E&P

WHITEPAPER

Valuation of Independent Trust Companies

Download Whitepaper

Continue Reading

Not All AUM Is Created Equal
Not All AUM Is Created Equal

Why Product Mix Matters in Investment Manager Valuation

Investment manager valuation depends on more than headline AUM. Fee rates, revenue durability, product-level growth, margins, and operating leverage all influence the quality of an asset base and the cash flows it can generate.
RIA Valuation Insights Blog Investment Management
Read Now about Not All AUM Is Created Equal
Changing Drivers
Changing Drivers

Thoughts on Compensation, Ownership, and Internal Succession

Successful RIA succession requires leadership, compensation, and ownership to evolve together over time. A gradual transition can align incentives, improve continuity, and give both senior and next-generation leaders meaningful participation in the firm’s future value.
RIA Valuation Insights Blog Investment Management
Read Now about Changing Drivers
The Sponsor Clock: What the Recapitalization Cycle Means for RIA Sellers Holding Rolled Equity
The Sponsor Clock: What the Recapitalization Cycle Means for RIA Sellers Holding Rolled Equity
Private equity sponsor timelines are bringing a new wave of recapitalizations to RIA platforms, with important implications for principals holding rolled equity. Understanding liquidity rights, valuation mechanics, and the timing of capital events can be critical to both transaction and wealth transfer planning.

Cart

Your cart is empty