Dividing Businesses And Business Interests In A Massachusetts Divorce
If you and/or your spouse own businesses or portions of businesses, it is essential to work with a family law attorney with ample experience in business valuation and complex property division.
At Watson Dalton LLC, you will find skilled litigators who have been practicing law since 1995. Our attorneys are ready to help you determine the most advantageous way to arrive at a fair value of your or your spouse’s business(es) and argue in favor of using that method during your negotiations, mediation sessions or trial.
How Our Lawyers Leverage Expert Knowledge In Business Valuation Counsel
Our divorce lawyers partner with business valuation experts to divide business assets in our clients’ divorces. These may include tangible assets (such as real estate, equipment and sales inventory) as well as intangible assets (for example, business goodwill, customer lists and intellectual property).
Examples of methods of business valuation that our partnered experts recommend are as follows:
- Book value based on the current balance sheet (a simple method that does not usually tell the whole story)
- Discounted cash flow (an estimate of future cash generation potential)
- Market capitalization (the number of shared multiplied by the share prices), a method that does not take debts into account
- Enterprise value (equity plus debt minus cash), a method that considers the total power behind a business
- Operating earnings, or earnings before interest and taxes
- Growing perpetuity, which is cash flow divided by the cost of capital minus the growth rate
Beware Of Do-It-Yourself Business Valuation Attempts
One of the most costly mistakes business owners make when approaching divorce is coming up with a ballpark estimate of their businesses’ worth themselves, instead of working with financial and legal professionals. Just knowing a company’s revenue does not equate to understanding the total value of the business. A business valuation expert’s services can be a sound investment in your fiscal future as well the health of your business.
To schedule a consultation with a divorce attorney in Essex County, Massachusetts, who can guide you efficiently and accurately through the business valuation process in your divorce, call 978-346-5302 or send an email inquiry.