THE CHALLENGE

The owner of a highly profitable service business was planning to get married. This person’s attorney suggested that a pre-nuptial agreement be drafted. Since a major asset was a closely held business, a business valuation was recommended as part of preparing a meaningful pre-nuptial document. Another trusted advisor of the business owner suggested the client turn to Leask & Leask for preparation of a realistic and professional valuation report.

THE SOLUTION

As is usual, extensive research on the company and benchmarking studies led to a realistic value for the company. As part of our standard research in preparing a valuation report, we investigated the industry, competitive firms, as well as this company’s operational and strategic plans.

Among the useful findings included in this valuation was that the owner needed to put in place signed non-solicitation and non-disclosure agreements with employees who have regular client contact. Once executed, these documents would help limit the exposure of clients potentially being taken by staff who leave the firm.

In addition, the valuation report provided helpful information about additional services provided by the firm’s competitors.

Some of these services are now being added by the firm, which should help make this highly successful company even more profitable. Finally, strategies were shared for making the business more marketable at a higher value should the owner decide to sell in the future.

The client was very pleased with the valuation report and the supplemental information received. Soon after, the accounting and tax work of the company was transferred to Leask & Leask. As a result John M. Leask II, who led the engagement was asked to sit on the company’s advisory board to help oversee and execute the resulting business plan and to make recommendations to the owner. As our firm’s motto “Advisors to Achievers” implies, we became a part of the team to help the owner achieve their future goals set for the business.

BENEFITS

ü       The value set for the company for use in the pre-nuptual agreement was more than expected but was acknowledged as reasonable and fair.

ü       The valuation report gave the owner useful information on the future of the industry including critical issues facing the company.

ü       The oral and written advice given included specific steps the company could take to improve value and profitability.

ü       As an ongoing client of Leask & Leask the company benefited from Leask & Leask’s professional advice and expert tax services.