Because there are no clear standards for what constitutes financial fairness, the financial advisor must rely on judgment and experience when making and supporting its determination that a transaction is fair. It is also important that the fairness opinion provider be independent so that potential conflicts of interest (most notably success fees) do not threaten the provider’s credibility.
The Cogent Valuation offices have issued independent fairness opinions in virtually all types of transaction for a wide variety of stakeholders, including public stockholders, common and preferred stockholders in private companies, limited partners, warrant and option holders, employee stock ownership plans (ESOPs) and charitable foundations. Through rigorous due diligence, thoughtful analysis and a careful scrutiny of the transaction structure, Cogent Valuation often uncovers issues that others have missed. While the vast majority of these are resolved with its constructive input, on a few occasions Cogent Valuation has declined to issue a fairness opinion when it was not satisfied that its fairness concerns had been resolved.
