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Fairness opinion

A Fairness Opinion is a valuation of the financial terms of a transaction made by a specialized, external consulting firm. The purpose of the study is to determine whether the terms of the planned transaction do not deviate from market standards.

A Fairness Opinion is a new product on the Polish capital market. Essentially, this is an independent opinion of a specialized advisory, concerning the financial terms of a planned transaction or activity from the point of view of the seller or buyer.

A Fairness Opinion includes the study and analysis of the most important determinants of the transaction terms and conditions or of other capital processes. This service is widely used in evaluating the financial parameters of mergers and acquisitions, stock quotes, forced redemptions, leveraged buyouts, privatizations, and key asset sales.

A Fairness Opinion is prepared in the form of a report confirming the reliability of the financial conditions determined.

In developed capital markets, a Fairness Opinion is widely used in assessing the financial parameters of mergers and acquisitions, stock quotes, forced redemptions, leveraged buyouts, privatization, sales of key company assets or share buybacks.

Also in Poland, due to the dynamic development of the capital market, we note an increased interest of the management boards in opinions of independent advisors on the terms and conditions of a given transaction.

A Fairness Opinion includes the study and analysis of the most important determinants of the transaction terms and conditions or other capital processes. A Fairness Opinion is written in the form of a report confirming the reliability of the actual financial conditions.

 

 

WHEN AND FOR WHOM IS A FAIRNESS OPINION PREPARED?

It is recommended that the Management Board should commission an independent opinion, especially if there is an increased risk of the terms and conditions of the offer deviating from the market price.

Such situations include:

  • transactions involving company affiliates,
  • attempts of hostile takeover,
  • disregarding the interest of minority shareholders,
  • submission of purchase bids by several entities,
  • submission of a purchase offer in circumstances unfavourable for the company,
  • for example, when unsatisfactory financial results are achieved.

A Fairness Opinion is moreover an excellent tool for evaluating the viability of the planned project or transaction. The advisor’s role is to issue an unbiased opinion about whether the conditions or planned outcomes of the activities envisaged will result in tangible benefits.

A Fairness Opinion provides both the company shareholders and the other stakeholders with a reliable and objective opinion that renders the company’s investment decisions more precise and rational. At the same time, the Management Board receives an objective opinion of a specialized advisory company regarding the planned activities.

CMT Advisory specialists have experience in providing opinions which are unbiased from the point of view of both the seller and the buyer. The experience of CMT Advisory, gained during the implementation of many merger and acquisition projects, is an additional asset.

CMT Advisory offers Fairness Opinions in the following cases:

  • call for shares,
  • redemption of own shares (buy-back),
  • buying a company or selling a business,
  • merger,
  • intra-group mergers and restructuring,
  • redemption of minority owners.

Get in touch

Interested? Get in touch!

618 533 010

Do you have any questions?
Contact us

tel.: (fax) 61 855 30 10
mail: biuro@cmt-advisory.pl