Valuation of unquoted companies

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Case studies

Revenue Commissioners of Ireland : Independent expert

US investor in London clearing house : Capital gains tax

Option to buy stately home : Capital gains tax

Family owned property company : Inheritance tax valuation

Hedge fund manager : Employee share scheme

US banking partnership : Valuation of intellectual property

Stamp Duty payable on acquisition shares : Stamp Duty

Revenue Commissioners of Ireland

Independent expert to the Revenue Commissioners of Ireland in respect of a complex valuation dispute concerning the value of shares in a major privately owned company.

Investor in UK stock exchange clearing house

The US investor needed to know whether the tax open market value of its investment in a UK company, the leading independent central counterparty group in Europe, had fallen below the value attributed to it at the time of a merger three years earlier. The valuation was required in order to assess the potential UK tax liability on an intra-group transfer.

Option to buy stately home

The client, a major firm of accountants, was providing tax advice to a major shareholder of one of the UKs largest privately owned consultancy businesses. They needed to know the open market value, for tax purposes, which would be attributed to a proposed option by the shareholder to buy a stately home from one of the group companies.

Family owned property company

Angela Hennessey acts for the trustees of various family trusts with shareholdings in a family controlled property company in agreeing with the Revenue values of minority stakes in the company required under the provisions of section 64 of the Inheritance Tax Act 1984. The family shareholders sought advice after their accountant, after lengthy negotiations was unable to reach an agreement with the Revenue. She prepared a detailed valuation report for submission to the Shares Valuation unit and after a short period of negotiation agreed values significantly lower than those put forward by the Revenue in the previous negotiations.

Hedge fund manager

Angela Hennessy has carried out regular valuations for a hedge fund manager, with assets under management of over £500 million, from the time of its formation until its flotation in 2004. These valuations were for the purposes of issuing options to employees under the company's Enterprise Management Incentive Scheme. She also advised on the value of convertible shares which were 'restricted shares' under the provisions of the Finance Act 2003. These shares had to be valued disregarding the restrictions on the shares relating to forfeiture and sale and ignoring the rights of conversion.

Major US banking partnership

Whilst at Coopers & Lybrand, Angela Hennessey was responsible for advising a major US banking partnership on the value of its United Kingdom operations for the purposes of a proposed corporate restructuring. In particular, the client wanted to know whether, in spite of the very significant profits generated by the UK business, there was a reasonable argument to say that any UK 'goodwill' was in fact owned by the US partnership who had the power to withdraw the corporate name. Her views were subsequently supported by those of a leading tax Counsel.

Stamp Duty payable by PLC on acquisition shares

This valuation concerned stamp duty payable on the value of 69 million shares in the listed company issued in consideration for the purchase of shares in a private company. The consideration shares represented approximately 58% of the enlarged issued share capital of the acquiror which prior to the acquisition was a shell company. A value per share of 80 pence was agreed with the Stamp Office, substantially below the quoted price and the placing price of similar shares. The client was very happy with this result as they had previously been advised by their tax accountants that they would have to pay stamp duty on a value of 191 pence per share.


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© Angela Hennessey 2004-2010
tel: +44 (0) 20 8993 8138 | email: amh@angelahennessey.co.uk

Dispute resolution | Independent expert | Commercial valuation | Tax valuation
Employee shares | Matrimonial | Fiduciary valuation | Intellectual property