We were engaged by the Plaintiff to prepare a business valuation report in a proceeding where a property from which the Plaintiff was operating a medical clinic was compulsorily acquired.
The Plaintiff was unable to relocate the business due to an inability to find suitable premises.
As part of the original negotiations, two valuation reports were obtained placing a value on the business of approximately $500,000.
Ferrier Hodgson Forensics:
- Determined that the methodology utilised in the two previous valuations was not appropriate as they considered only market value and did not include special value, as required by the relevant legislation under which the land was acquired.
- Input the business’ cash flows into a financial model which enabled us to calculate the net present value of the total cash flows that could be expected from the business, utilising a discount rate which took into account the risks of that particular business.
Ferrier Hodgson estimated the Plaintiffs business to be valued at approximately $900,000.