Solvency Opinions

A solvency analysis and opinion helps companies and their boards of directors steer clear of fraudulent transfers and illegal dividends or distributions.

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Various jurisdictions impose certain duties on boards of directors with respect to dividends, distributions and other transfers. Dividends must be paid from surplus, and cannot leave the company insolvent or with insufficient capital.  

A solvency opinion makes determinations as to whether, after giving effect to a transaction:

  • The company’s assets exceed its debts;

  • The company should be able to pay its debts as they come due;

  • The company is not left with unreasonably small assets or capital; and

  • There is sufficient surplus to affect a distribution.

These determinations arise from fraudulent transfer statutes and dividend prerequisites in certain jurisdictions. Solvency analysis also provides a board and company management with valuable insight as to the equity and cash flow cushion with respect to its ongoing business.

 

Duff & Phelps' is a globally recognized leader in solvency opinions. Since 2005, we have rendered more than 1,950 fairness and solvency opinions for transactions with an aggregate deal value of over $4.9 trillion.

Solvency Advisory Services

 

A solvency analysis and opinion can enhance the company’s or board’s analysis of any leveraged transaction or contemplated distribution. The types of applicable transactions include:

  • Spin-offs and split-offs
  • Dividend recapitalizations
  • Leveraged buyouts
  • Debt refinancing
  • Intercompany restructurings
  • Large stock buybacks

People

Howard Johnson
Howard Johnson
Head of Canadian M&A Advisory and Country Leader
M&A Advisory
Toronto
Phone
Chris Nobes
Chris Nobes
Managing Director, Technology Expert, Testifying Expert
Expert Services
Toronto
Phone
Andrew Capitman
Andrew Capitman
Managing Director
Fairness and Solvency Opinions
Phone
Christopher Janssen
Chris Janssen
Managing Director and Global Head of Transaction Opinions
Fairness and Solvency Opinions
Chicago
Phone

How we can help

Debt Advisory

Kroll assists clients in securing initial financing or restructuring of their existing debt obligations.

M&A Advisory

Kroll is a leading middle-market M&A advisor.

Business Valuation and Appraisals

Kroll provides valuation and asset appraisal for financial reporting, income tax, investment and risk management purposes.

Distressed M&A and Special Situations

Kroll professionals have advised hundreds of companies, investors and other stakeholders at all stages of distressed transactions and special situations.

Private Capital Markets

Kroll has extensive experience raising capital for middle-market companies to support a wide range of transactions.

Fairness and Solvency Opinions


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