Our Experience

Industries Petroleum Natural Gas Chemicals Electronics Pharmaceuticals, Medical Devices, & Biotech Retail/Consumer Goods Technology Transportation Local/State Government School Districts Other Industries

Functional Areas Antitrust & Competition Analysis of Damages Forensic Economics Intangibles/IP Labor Economics Regulatory Economics & Finance Transfer Pricing Taxation Valuation Fiscal Impact Analysis Demographic Analysis Public Policy Analysis

 

Valuation

IIC, Inc. has extensive experience in the valuation of assets, liabilities, equity positions, and business enterprises. We apply advanced financial, statistical, and economic techniques to provide our clients with informative and accurate value conclusions. Every valuation exercise presents unique challenges that require an in-depth assessment of market fundamentals and risk factors. Our team of valuation experts provides unbiased, objective financial and economic analysis of all relevant factors that influence value determination. We have previously valued a wide range of tangible and intangible assets, as well as the fair market value of business enterprises. In each project, we consider all potential valuation methods to provide our clients with a clear and concise estimate of value that is both theoretically and quantitatively sound.

We provide our clients with valuation expertise in the context of expert testimony, litigation support, tax analysis, capital budgeting, cost of capital determination, regulatory concerns, financial modeling and business management strategy. Previous engagements include valuations performed across numerous industries, including, among others, the consumer finance, oil and gas, oil field services, agriculture, educational institutions, chemicals, retail and consumer goods, electronics and electronic components distribution, computers, software, transportation, medical devices, and pharmaceutical industries.

Asset Valuation

The valuation of tangible and intangible assets can provide a complex challenge to individuals and corporations. The need for an unbiased but insightful valuation is paramount in helping resolve litigation and tax issues, developing strong capital budgeting models, or considering the purchase or sale of an asset. The science of valuation continues to evolve and each valuation project requires a knowledgeable team.

IIC, Inc. recently completed a comprehensive valuation of all of the tangible assets of a large, multinational petroleum company. Relying on our expertise in the petroleum industry, we valued both upstream and downstream tangible assets, including oil and gas reserves, refineries, petrochemical plants, pipeline and other transportation assets, marketing assets and the equity positions held by subsidiaries. This engagement involved using a wide variety of valuation methods, notably a discounted cash flow approach, capitalization of earnings approach, cost approach, and a market multiples approach. The large scale valuation effort required IIC, Inc. to develop complex financial valuation models, which helped provide the client a clear and concise summary of the different values for each group of assets.

We valued the tangible assets of a large, multinational consumer goods corporation to assist in tax planning and merger and acquisition activity. We employed discounted cash flow, market multiple and cost approaches to value the different operating segments of the company. Part of our analysis involved risk assessment, including a focus on the various market factors which often lead to uncertainty in valuation results. By analyzing the market fundamentals, we developed the most defensible and plausible underlying valuation assumptions, which lead to an accurate and precise valuation conclusion. We provided our client with a comprehensive valuation report that detailed our findings in an easy to understand and informative narrative.

Business Valuation

Complex valuation projects often involve assessing the business enterprise value. In these instances, IIC, Inc. values the aggregation of all tangible and intangible assets to determine the fair market value of the business as a whole. Using our valuation expertise, we often apply several different sophisticated approaches in developing rigorous analytical models. These include the comparable transactions approach, guideline company approach, and income approaches.

Recently, several IIC, Inc. completed a comprehensive business enterprise valuation of two agricultural companies. We analyzed internal financial documents and strategic plans and developed discounted cash flow models to determine the business enterprise value. We applied our extensive knowledge of the agriculture industry to appropriately incorporate the various risks and market factors into our discounted cash flow analyses. Following good valuation practice, we also investigated a market approach, where we found comparable companies from a functional and risk standpoint. We developed a series of different market multiples that allowed us to corroborate our discounted cash flow analysis. We provided our client with a clear and concise valuation report, complete with our detailed financial models and value conclusions.

IIC, Inc. determined the business enterprise value of a large multinational petroleum company, as part of an overall tax analysis project. Using a market multiples approach, we performed an in-depth functional review and isolated potential comparable companies. We compiled underlying financial data, performed an extensive quality control process to ensure data accuracy, and computed a variety of valuation multiples. We provided our client with a detailed summary of our results, including the basis and support for all underlying assumptions and calculations.

IP Valuation

The increasing importance of intellectual property has widespread ramifications for the valuation field. Tax authorities are increasing efforts to examine and audit transfers and use of intellectual property. The risk of patent infringement leads to increased litigation costs for individuals and companies. Companies need an accurate assessment of the economic benefits contributed by intangible property when considering capital budgeting decisions. IIC, Inc. specializes in the valuation of intellectual property, providing our clients with valuation expertise in a diverse array of intellectual property matters across several industries.

Different engagements require unique approaches to valuation. In a recent project, one principal testified in U.S. Tax Court on the specific meaning and interpretation of valuation concepts incorporated in the United Kingdom’s Windfall Tax Formula. IIC, Inc. prepared an in-depth report supporting our position and provided our client the expertise necessary during litigation. As part of our litigation support efforts we provided our client with valuable assistance in developing cross-examination for key opposition expert witnesses.

Cost of Capital Issues

A widely used valuation approach is the discounted cash flow method. The discounted cash flow method involves projecting future cash flows and discounting them to present value using an appropriate discount rate. Companies often use the cost of capital to discount cash flows and assess capital budgeting decisions. In a valuation context, the use of the cost of capital as a discount rate incorporates risk assumptions regarding the entity or asset being valued. IIC, Inc. has worked extensively on cost of capital and discount rate issues, including the appropriate determination of a discount rate when valuing entities using a discounted cash flow analysis.

IIC, Inc. recently completed a consulting engagement where we valued a series of international oil and gas assets. We employed a discounted cash flow analysis, which included an in-depth investigation into the appropriate discount rate. We computed costs of capital on a country-by-country basis, including a full assessment of all pertinent risks and market factors which would influence the cost of capital.

The cost of capital is also vitally important when assessing the appropriate cost of service and allowed rate of return for regulated oil, gas, and product pipelines. Government regulatory precedent often dictates specific methods for the analysis of the cost of capital, or more importantly, the return on equity used in ratemaking procedures. We possess significant experience investigating the appropriate return on equity and cost of capital for pipeline operators under a regulatory context. Our knowledge of cost of capital issues in our valuation practice complements our regulatory finance division and provides our clients with a comprehensive body of knowledge for appropriately determining the cost of capital.