Willamette Management Associates analysts perform complex valuations of businesses, business ownership interests, debt and equity securities, intangible assets and intellectual properties, and special purpose properties. We routinely perform these complex valuations for the following purposes:

  • Bankruptcy and reorganization
  • ESOP transactions and ERISA compliance
  • Fair value accounting and financial reporting
  • Financing securitization and collateralization
  • Forensic analysis and expert witness testimony
  • Management information and corporate planning
  • Not-for-profit entity transactions and opinions
  • Taxation planning and compliance (including income, gift, estate, and property tax)
  • Transaction fairness, solvency, and other financial opinions
  • Transaction pricing and structuring

Bankruptcy and Reorganization
We perform valuations of the secured creditors' collateral interest in debtor assets, of Section 363 property sales, of debtor-in-possession (DIP) financing transactions, and of other DIP proposed transactions. We perform solvency and insolvency analyses of debtor corporations. We review the reasonableness of proposed plans of reorganization. And, we perform fresh-start accounting valuations for debtors emerging from bankruptcy protection

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Bankruptcy Testifying Expert Services
Willamette Management Associates was engaged by the proponents of a reorganization plan to prepare a declaration in the matter of In re Plant Insulation Company (No. 09-31347, U.S. Bankruptcy Court, N.D. Cal. 2014). Our assignment was to review the declarations of the opposing experts in this case and to offer our opinion on certain shareholder agreements related to the matter. In particular, we were asked to review a right of first offer agreement and to opine on its impact on the control, transfer, and value of common stock and warrant interests in Bayside Insulation and Construction, Inc. Following a trial, at which Willamette managing director Curtis Kimball offered rebuttal expert testimony, the U.S. Bankruptcy Court accepted the plan of reorganization proposed by the Futures Representative of the Official Committee of Creditors.

We were retained by legal counsel for the secured creditors' committee. Our assignment was to estimate the fair market value of the total equity of an oil pipeline company DIP. Based on both the discounted cash flow and the guideline publicly traded company valuation methods, we valued the DIP equity at a positive $50 million. This positive equity value supported the creditors' proposed plan of reorganization. We testified in U.S. Bankruptcy Court on behalf of the creditors' committee, and the case settled favorably before the conclusion of the trial.

In U.S. Bankruptcy Court, we testified for our client, the secured creditors' committee, as to the fair market value of a Florida residential real estate developer. One dispute in this bankruptcy involved the proposed plan of reorganization. Specifically, the dispute related to the value of the DIP business enterprise on a going-concern basis versus the value of the DIP business enterprise on an orderly liquidation basis.


ESOP Transactions and ERISA Compliance
We provide valuation opinions and fairness opinions to ESOP trusts that are buying or selling sponsor company securities. We also provide annual sponsor company fair market valuations for ESOP administration and ERISA and tax purposes.

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A regional grocery store chain formed an employee stock ownership plan (ESOP). The ESOP purchased 100 percent of the employer company common stock from the founding family shareholders. We provided a fairness opinion to the ESOP institutional trustee, opining that the ESOP was not paying more than adequate consideration for the employer company stock.


Fair Value Accounting and Financial Reporting
We perform fair value valuations of acquired businesses, tangible and intangible assets, and compensation-related securities. These fair value valuations comply with GAAP reporting standards related to purchase accounting, impairment of goodwill or of long- lived assets, or stock-based compensation.

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We recently performed a purchase accounting allocation for a Fortune 500 defense contractor. We concluded the fair value of the acquired company's working capital, real estate, tangible personal property, identified intangible assets, and goodwill. We also concluded the fair value of the total purchase consideration, including an analysis of the contingent future earn-out payments.

We recently performed a long-lived asset impairment study (and the related asset fair value appraisal) for a Fortune 500 client in a capital-intensive manufacturing industry. This engagement included impairment analyses of tangible assets (e.g. manufacturing equipment and real estate) and of intangible assets (e.g., trademarks, patents, and licenses).

We recently valued executive/employee stock options for a substantial closely held corporation for fair value accounting purposes. We valued the compensation elements of all of the corporation options, warrants, grants, and rights. Using all allowable option pricing models, we estimated the fair value of the company's share-based compensation.

We recently performed the fresh-start accounting fair value analysis of a national retail chain. The client was emerging from bankruptcy, and the client needed to restate the reorganized company assets and liabilities at fair value.


Financing Securitization and Collateralization
We value derivative securities that are collateralized by debt instruments or other assets. We value securities and income producing property that serve as collateral for a secured financing or restructuring.


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For a publicly traded energy company, we valued electric generation, distribution, and transmission facilities—both domestically and internationally. These facilities were used as collateral to secure public debt offerings.

For a major financial institution, we valued numerous industrial and commercial properties that were used as collateral for sale/leaseback transactions.


Forensic Analysis and Expert Witness Testimony
Our forensic analysts quantify lost profits and other economic damages related to either a breach of contract or a tort. Our forensic analysts have testified in federal, state, and international courts with respect to antitrust, shareholder disputes, bankruptcy, infringement, breach of contract, interference with business opportunity, family law, securities fraud, and other commercial litigation matters.

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Transfer Pricing Testifying Expert Services
In the matter of Amazon.com, Inc. & Subsidiaries v. Commissioner (148 T.C. No. 8 (2017)), the U.S. Tax Court found in favor of the taxpayer plaintiff. The case involved a 2005 cost sharing arrangement that Amazon entered into with its Luxembourg subsidiary. Amazon granted its subsidiary the right to use certain pre-existing intangible property in Europe, including the intangible assets required to operate Amazon's European website business. The Tax Court held that (1) the Service's determination with respect to the buy-in payment was arbitrary, capricious, and unreasonable; (2) Amazon's CUT transfer price method (with some upward adjustments) was the best method to determine the requisite buy-in payment; (3) the Service abused its discretion in determining that 100% of technology and content costs constitute intangible development costs (IDCs); and (4) Amazon's cost-allocation method (with certain adjustments) was a reasonable basis for allocating costs to IDCs. Robert Reilly, a managing director of our firm, provided expert testimony on behalf of taxpayer Amazon in this Section 482 intercompany transfer pricing case.

We were retained by legal counsel representing the Pennzoil Corporation board of directors to provide an expert opinion and expert testimony with regard to the acquisition of Pennzoil by Shell Oil. A dissenting shareholders appraisal rights action was filed by several former Pennzoil shareholders. The plaintiffs claimed, among other allegations, that the Pennzoil board accepted a price below the fair value of the shares when it ratified the proposed transaction. The agreed upon price-$22 per share, or approximately $1.7 billion-produced a total Pennzoil acquisition value of approximately $3 billion. We concluded that the $22 per share price accepted by the Pennzoil board was a fair price, based on our independent fair value conclusion of $21.41 per share. The dissenters claimed that the fair price was $34.26 per share. After a three-week trial, the jury ruled in favor of the Pennzoil board of directors, agreeing with us that the transaction price was fair.

We were retained by legal counsel in a dissenting shareholder appraisal rights case on behalf of a company that operates a one-mile racetrack. The racetrack hosts two annual NASCAR Winston Cup Series races, along with other motor sports events. Our analyst provided expert testimony in state court as to the fair value of the subject company equity. The court accepted our fair value conclusion with no material adjustment.

Pacific Guardian Life Insurance Company was majority owned by a Japanese financial services institution. Through the implementation of a reverse stock split, the Japanese parent corporation cashed out all of the minority stockholders. Certain stockholders exercised their dissenting shareholder appraisal rights. We estimated the fair value of the Pacific Guardian stock in support of the parent company's cash out price. And, we provided expert testimony in state court in support of our fair value appraisal.

We were retained by the U.S. Department of Labor (DOL) to provide independent financial adviser services related to an ESOP sponsor company. An issue in the dispute related to the fair market value of the common stock of a printing equipment distributor employer corporation. Over the course of approximately 18 months, the sponsor company operations failed. During that period, the employer corporation made distributions to the key management/controlling shareholders. The ESOP owned approximately 40 percent of the outstanding employer stock. On audit, the DOL questioned (1) the amount of the management distributions and (2) the most recent employer stock valuation prepared prior to the discontinuation of the company operations. We advised the DOL in its negotiations leading to a successful settlement of the dispute.


Management Information and Corporate Planning
We perform buy-sell agreement and other ownership transition valuations. We perform complex business valuations for estate planning purposes. We value spin-off and other cash flow generation opportunities. We analyze expected synergistic benefits and recommend merger or acquisition price bids.

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For a nanotechnology IP development company, we identified various trade secrets and other intellectual property. We developed a plan for our client to transfer its IP to an off-shore subsidiary and to license back the IP for an arm's length price (ALP) royalty rate. In addition, we developed a plan to allow the client to outbound license the IP to several multinational businesses from its IP holding company subsidiary.


Not-for-Profit Entity Transactions
Whenever a for-profit entity transacts with a not-for-profit entity, the respective boards should be concerned with private inurement or excess benefits issues. Accordingly, we perform fair market value valuations of the transferred entity (e.g., medical practices, clinics, hospitals). We also perform fair market value valuations of services contracts (e.g., office lease, employment agreement, management contract) between the for- profit and the not-for-profit parties.

For not-for-profit hospital clients, we have opined on the fairness of the purchase price for purchases of medical practices, dialysis centers, urgent care centers, ambulatory surgery centers, diagnostic imaging facilities, and other health care businesses and practices. These fair market value valuations were intended to provide comfort to the hospitals with respect to excess benefits, private inurement, and other regulatory issues.

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We prepared a fairness opinion related to a not-for-profit university complex purchase of the assets and business structure of a for-profit college. This fair market value valuation was intended to provide comfort to the not-for-profit buyer's board of directors with respect to private inurement considerations.


Taxation Planning and Compliance
We perform valuations of close corporations, fractional business interests, restricted public securities, and intellectual property for gift tax, estate tax, and income tax purposes. We conclude the arm's-length price of tangible property, intangible property, and services for intercompany transfer price purposes. And, we value special purpose and income-producing properties for ad valorem property tax purposes.

Sample Engagements +

Income Taxation Testifying Expert Services
On February 21, 2017, the U.S. Court of Federal Claims dismissed (with prejudice) the complaint filed by plaintiff Washington Mutual, Inc., against the United States (Nos. 08-321T, 08-211T). The taxpayer plaintiffs were seeking a refund of at least $149 million in certain federal taxes paid by H.F. Ahmanson & Co. ("Ahmanson") during several tax years in the 1990s, based upon the abandonment loss and amortization deductions available under the Internal Revenue Code. The case involved the fair market value determination of the regulatory right to open deposit-taking branches in certain states other than California ("branching rights"), the contractual approval right to treat the goodwill created by certain acquisitions as an asset for regulatory accounting purposes ("RAP rights"), and certain other intangible assets. Curtis Kimball, a managing director of our firm, critiqued the valuation report presented by the plaintiff's valuation expert and provided rebuttal expert testimony on behalf of the U.S. Department of Justice regarding the valuation of branching rights and RAP rights intangible assets. The Claims Court dismissed the plaintiffs' tax refund claims.

We provided valuation services to a professional basketball franchise owner as part of a complex estate plan and business succession plan. To assist our client with his overall estate planning objectives, we estimated the fair market value of both the NBA franchise and a partial ownership interest in the NBA franchise.

We were retained by tax counsel representing the estate of a large shareholder in a national media company. We estimated the fair market value of an approximately 10 percent block of the outstanding common stock. This company operated in the following industries: newspaper publishing, cable television, and book publishing. The fair market value of the estate's interest was approximately $50 million. Our stock valuation was audited by the Internal Revenue Service, and the Service accepted our valuation without any material changes.

We were retained to conduct a purchase price allocation for a major consumer products manufacturer. The transaction was structured as a taxable purchase of assets. As part of the purchase price allocation, we identified and valued the following Section 197 intangible assets: (1) trademarks and trade names, (2) customer relationships, (3) proprietary technology and technical documentation, (4) supply contracts, (5) computer software, (6) trained and assembled workforce, (7) licenses and permits, (8) product formulations and trade secrets, and (9) goodwill.

We estimated the fair arm's-length price (ALP) of the trademarks and trade names and the patterns and designs for an upscale women's fashion designer. The domestic corporation owner/operator transferred this intangible property to an offshore entity. The intangible property was licensed to the domestic parent corporation and to affiliated manufacturing entities in various countries.

We were retained by a leading oil and gas exploration and production company located in eastern Texas. The purpose of the engagement was twofold. First, we assisted in the structuring of a newly formed management services company. The services company was created to provide management, administration, and other services to the legacy operating company. As part of this structuring, we estimated the fair ALP for the services to be performed by the services company. Second, we estimated the fair market value of an ownership interest in the operating company, following the restructuring, for gift tax and estate planning purposes. Our valuation included an analysis of the operating company's oil and gas properties, related production equipment, and investments in other privately held ventures.

We valued the exempt (from property tax) intangible assets of a major Texas Gulf Coast oil refinery. At trial, we testified as to the fair market value of proprietary technologies, computer software, engineering drawings and technical documentation, licenses and permits, contracts and contract renewals, and a trained and assembled workforce.

For an electric generation facility in New York, the state property tax authority assessed the property based on a recent acquisition price. Our client was the corporate acquirer, a publicly traded energy company. We valued the intangible assets of the acquired electric generation facility, including power purchase and sale contracts, environmental credits, and operating manuals and procedures. After a review of our valuation, the assessment authority reduced the value of the taxable unit by the value of these intangible assets.

We quantified overall unit value adjustments for a centrally assessed telecom company due to functional (including technological) and external (including economic) obsolescence. These obsolescence analyses include inutility analyses, excess operating cost analyses, excess capital cost analyses, and fair return on investment analyses. In addition, we provided expert testimony related to these functional and economic obsolescence adjustments.

We performed the unit valuation of a centrally assessed Class I railroad. This engagement included the valuation of the exempt intangible assets included in the railroad overall unit value.


Transaction Fairness, Solvency, and Other Financial Opinions
For both public company and private company transactions, we provide fairness opinions, solvency opinions, reasonably equivalent value opinions, and fair market valuation opinions. These financial opinions provide comfort to buyer and seller boards, financial institutions, and other parties that the pending transaction is fair from a financial perspective..

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When one public telecom company acquired another public telecom company in a highly levered transaction, we provided the solvency opinion. This solvency opinion provided comfort to the boards of directors of both public corporations.


Transaction Pricing and Structuring
We provide business valuations for clients that are involved in the purchase or sale of a closely held company. These transactions include company sales to employees or to management, the spin-off of public corporation divisions or subsidiaries, going-private transactions, and private company ownership transitions. We specialize in designing securities and complex capital structures that meet the requirements of a multiple investor transaction.

Sample Engagements +

For a medical device manufacturer going through an ownership transition, we designed several classes of debt and equity securities. Based on this transaction structure, all transaction participants—the general employee, management, and private equity buyers, and the selling shareholder and mezzanine financing sources—received securities that satisfied their investment objectives. Although complex, this deal structure allowed the transaction to proceed to closing.