Solvency Opinions—Special Dividends and Stock Buybacks

The Duff & Phelps Opinions practice is your trusted advisor for special dividends and stock buybacks and is a globally recognized leader in solvency opinions.

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Special dividends and stock buybacks continue to be attractive transactions for private equity sponsors and public companies alike. We tend to see an uptick in these deals each fourth quarter. A dividend or stock buyback that renders a company insolvent, however, has serious consequences for boards of directors. Therefore, boards are often advised to obtain a third-party solvency opinion when approving such transactions. Relying on a solvency opinion from an expert like the Duff & Phelps Opinions practice of Kroll creates a safe harbor (under state laws) for board members.

Download our Solvency Opinions - Dividend Recapitalizations brochure.

Solvency Opinion Overview

A solvency opinion is a financial opinion as to whether, after giving effect to a transaction, (i), the company’s assets, at a fair valuation, would exceed its debts; (ii), the company would not be left with unreasonably small assets (or capital); and (iii), the company would be able to pay its debts as they come due. In the United States, these determinations arise from bankruptcy and fraudulent transfer laws. Solvency opinions also address the company’s ability to pay a dividend or repurchase shares, pursuant to corporation, partnership and/or LLC laws in the state of domicile. Company officers may rely on a solvency opinion when providing an officers’ solvency certificate, which istypically a closing condition of a financing transaction.

 

The Kroll Difference

The Duff & Phelps Opinions practice of Kroll serves as an independent advisor to boards of directors, special committees and other fiduciaries, and in this capacity, we are a leading global provider of fairness and solvency opinions in corporate transactions. Our team has particular expertise in situations where advisor independence is paramount and scrutiny is elevated.

Since 2005, Duff & Phelps Opinions has rendered over 1,045 solvency opinions for transactions aggregating over $5.5 trillion in deal value.

Duff & Phelps Opinions gives each engagement senior-level attention; every assignment is overseen by an experienced managing director, and every opinion is approved by our Opinions Review Committee. We thoroughly document our process, analysis and conclusions and stand ready to defend our work should the need arise

 

Kroll ranked no. 1 for total no. of fairness opinions in the U.S. and globally over the last 5 and 10 years

 

Over 1,045 Solvency Opinions for Transactions Aggregating Over $5.5 Trillion in Deal Value
Solvency Opinions Round up Campaign

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Christopher Janssen
Chris Janssen
Managing Director and Global Head of Transaction Opinions
Fairness and Solvency Opinions
Chicago
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Bob Bartell
Robert A. Bartell, CFA
President, Corporate Finance
Corporate Finance and Restructuring
Chicago
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Corey Bleil
Corey Bleil
Managing Director
Fairness and Solvency Opinions
New York
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Elyse Bluth
Elyse Bluth
Managing Director
ESOP and ERISA Advisory
Chicago
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Andrew Capitman
Andrew Capitman
Managing Director
Fairness and Solvency Opinions
New York
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Sheryl Cefali
Sheryl Cefali
Managing Director
Fairness and Solvency Opinions
Los Angeles
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Jeff Gordon
Jeff Gordon
Managing Director
Fairness and Solvency Opinions
Chicago
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David Herr
David Herr
Managing Director
Fairness and Solvency Opinions
Philadelphia
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Todd Kaltman is a managing director at Duff & Phelps.
Todd Kaltman
Managing Director
Fairness and Solvency Opinions
Los Angeles
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Mark Kwilosz
Mark Kwilosz
Managing Director
Fairness and Solvency Opinions
Chicago
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David Lee
David Lee
Managing Director
Fairness and Solvency Opinions
New York
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David Rowe | Transaction Opinions | Kroll Chicago
David Rowe
Managing Director
Fairness and Solvency Opinions
Chicago
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Jeffrey Schiedemeyer
Jeff Schiedemeyer
Managing Director
Fairness and Solvency Opinions
Chicago
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David Turf
David Turf
Managing Director
Fairness and Solvency Opinions
Chicago
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Fairness Opinion


In Defense of Fairness Opinions: An Empirical Review of Ten Years of Data

Mar 28, 2017 -

by Chris JanssenRobert A. Bartell, CFA