Business Enterprise Valuation Facilitates $12.7 Million Transaction
Client: New York Bus Service Company
Challenge: Provide Fair Value Certificate of Subsidiary for Sale
One of the largest providers of bus transportation in North America was selling the assets of its school and charter transportation subsidiary for $12.7 million. Before it could execute the deal, however, one of its bond issuers – a major New York City bank – asked the company to provide an independent appraisal, legally referred to as a fair value certificate, attesting to the subsidiary's worth, as required under the Trust Indenture Act of 1939.
AccuVal Approach
The company asked AccuVal to provide a valuation of the entire business enterprise – and complete the task within three weeks to satisfy the terms of the bond agreement regarding the release of collateral in a proposed transaction. To arrive at a detailed valuation conclusion, AccuVal conducted extensive interviews with management and with financial and marketing personnel. A detailed analysis was conducted of the subsidiary's historical financial statements and the pro-forma projections provided by management. Because of AccuVal's ability to execute its work plan in a timely manner, a specified fair value certificate was delivered that met the expectations of all parties.
Bottom Line: Bank Concurs With Valuation; $12.7 Million Deal Gets Executed
The New York bank that issued the bond accepted AccuVal's well-documented independent analysis and fair value certificate. The deal closed on schedule.
The AccuVal AdVantage™
The ability to tackle major financial transactions under tight time constraints and deliver an accurate work product. A name recognized by international investors, money-center banks, venture capitalists and financial syndicators. That's The AccuVal AdVantage™ at work.
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