Valuation Services

Subsequent to its consummation of an acquisition of a luxury retail business, a private equity fund had the opportunity to purchase at a significant discount some of the debt financing originally used to help acquire the business. The fund believed that the price to acquire the debt was distressed because of the market dislocation caused by the recession and subsequent liquidity crisis and that the acquisition price did not accurately reflect the intrinsic value of the debt acquired. Consensus was engaged by the portfolio company to value its enterprise and provide an opinion on the impairment of the acquired debt. Consensus utilized traditional valuation techniques to estimate enterprise value and incorporated a Monte Carlo simulation analysis to quantify the likelihood of full repayment of the acquired debt at maturity or the re-financing thereof.