Appraisal Economics valued a permit that conferred the rights to use patented technology underlying a unique coal gasification process. The technology provides the flexibility for the use of either conventional fossil fuel or alternative feedstocks such as biomass. This technology will be incorporated into a larger facility that will ultimately produce transportation fuels and electricity for sale into wholesale markets. The income approach was utilized, including an analysis of arm’s length royalty rates for similar technologies. The results of our study were used for financial reporting purposes.
Please click for more information about the valuation of intangible assets.
PURCHASE PRICE ALLOCATION
Appraisal Economics Inc. has conducted a purchase price allocation of a North American-based integrated manufacturer and wholesaler of branded and private label paper products. The company produces and sells paper towels, bathroom tissue, and napkins for the “at-home” and “away-from-home” markets. A publicly traded company purchased the business for cash and restricted shares. Appraisal Economics valued the restricted shares to determine the fair value of the consideration paid for the company, and then allocated the purchase price among the financial, tangible, and intangible assets of the company. The assets included machinery and equipment, contracts, a license to use the seller’s trade name, a non-compete agreement, customer relationships, and goodwill. Once goodwill is placed on the balance sheet due to an acquisition, it is tested at least annually for impairment.
TENANT-IN-COMMON INTEREST IN EQUITY
Appraisal Economics Inc. has conducted a valuation of one of the leading producers and distributors of fresh and packaged seafood. The company processes and delivers a wide range of fresh and ready-to-cook seafood to supermarkets, club stores, and restaurants in the United States and select international markets. The company sells both wild and farm-raised fish, including species such as salmon, tilapia, mahi mahi, and shrimp. Appraisal Economics valued a tenant-in-common interest in a block of the company’s equity for estate tax purposes.
Appraisal Economics Inc. valued an outperformance plan (OPP) for a publicly traded REIT for quarterly financial reporting purposes. OPPs and long-term incentive plans (LTIP) are forms of stock-based incentive compensation that allow executives and employees to share in the incremental value created for shareholders by share price appreciation and dividends during a defined performance period. Unlike plain vanilla stock options, OPPs and LTIPs are more customizable, allowing a company to set absolute or relative performance goals. Examples include achieving specified levels of total shareholder return relative to a benchmark stock index or a defined peer group of other publicly traded companies. Appraisal Economics Inc. helps companies design, value, and assess the interim performance of these derivative securities.
Please click for more information about the valuation of complex derivative securities.