Sometimes the Right Answer is "NO"

Client Profile
Private Company with Sole Customer

Situation
The Company had a longstanding relationship with the exclusive customer for its services. Our client invested heavily in the front–end of the relationship and was now reaping the sizable benefits from their labor and investment. As a result, their customer proposed to buy out their contract in exchange for a partnership position in the customer company, with our client then joining the customer company as an employee.

Solution
We did a detailed and complex valuation and cashflow analysis of the two scenarios, negotiated with the bidder, and ultimately advised our client to decline the proposal.

Result
The client declined the proposal and continues to reap tremendous financial reward under the terms of the contractual relationship between themselves and their customer.

Public vs. Private

Client Profile
Small Public Company

Situation
This public company estimated that it was costing them over $1 million to remain publicly traded and was considering going private and redeploying that $1 million a year toward building their business.

Solution
We conducted a thorough analysis of the costs, benefits, drawbacks, and risks associated with going private versus those associated with remaining publicly–traded. We presented this analysis to the CFO, who in turn shared the analysis with the CEO and Board.

Result
The Company saved several months of time and tens of thousands of dollars embarking on a likely–unsuccessful attempt to take the Company private. In addition, the Company also insulated themselves and their Directors and Officers from potential liability that a going–private transaction may have brought about.

Quick Turnaround on Fairness Opinion
Keeps Transaction on Schedule

Client Profile
Public Software Company

Situation
Company Board evaluated an opportunity to merge with another public software company in a stock-for-stock exchange requiring a complex fairness opinion to be completed within one week. The quick turnaround required rapid and efficient coordination of all parties on both sides of the transaction.

Solution
DCA quickly mobilized a broad but well-coordinated team to evaluate the proposed terms of the merger; assess the historical and projected financial performance of the Company; analyze public company comparables, precedent transactions and other relevant financial metrics. With this information in hand, DCA was able to issue a definitive opinion regarding the fairness of the merger.

Result
DCA completed its analysis within the required time frame, allowing the Board to respond to the merger opportunity and file the SEC documents on time. One experienced board member complimented the quality of DCA’s valuation work as being of “exceptionally high quality - particularly given the short time frame.”

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