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Case Study
WilliamsMarston Clears the Way for Series of Purchase Accounting Valuations
Discover how WM delivered several valuation analyses for an education technology company who, following a significant private equity investment, experienced a quick cadence of add-on acquisitions.
The Challenge
A $300 million education technology company needed support with multiple purchase accounting valuations.
After a private equity investor bought a controlling interest in the rapidly growing education technology company, the company pursued a number of add-on acquisitions over the following 24-months, triggering an immediate need for external support to complete purchase accounting valuations.
In addition to the purchase accounting needs, the company also required specialized valuations for dividend recapitalizations related to the growth—something they looked to WM to support.
The Solution
WM valuation experts were deployed to meet the new standard – without increasing the scope or fees.
WM was called in to perform the original purchase accounting valuation work following the private equity investment. As part of the scope, the team recognized standard assets, such as technology, customers and brand-related assets. The WM prepared an additional valuation needed related to rollover equity and worked closely with the audit team reviewing the prepared analysis to satisfy their review.
Following this effort, the team was re-engaged to prepare purchase accounting analyses for four add-on acquisitions. Similar assets for each company were also recognized, however, with several of these companies being asset acquisitions. During the engagement for these four add-on acquisitions, WM worked with the company’s then provider preparing technical accounting memos and opening balances, some analyses requiring significant back and forth related to changes in the opening balance sheet.
Given the company’s strong relationship with WM, the team was then asked to perform three different specialized complex valuation exercises related to debt restructuring and dividend payments. Through this work, WM identified areas for improvement in the technical accounting treatment of prior acquisitions and offered to set up a discussion with WM’s technical accounting experts.
The Result
WM’s deliverables supported the company’s audit and served as the foundation for an evolving relationship, extending beyond just valuation services.
WM successfully prepared the valuation analyses needed for purchase accounting and satisfied the auditor’s review requirements. The project also led to the beginning of a new partnership between the company and the WM Advisory team, who soon began providing assistance related to various technical accounting areas.
THE TEAM RESPONSIBLE
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Joseph McKneely
Partner – National Valuation Leader
Joseph brings more than 20 years of valuation advisory experience to WilliamsMarston. His extensive valuation expertise includes financial reporting matters such as mergers and acquisitions, purchase price allocations, goodwill and intangible asset impairments, complex debt and equity instruments, tax reporting matters such as 409A and intangible asset valuations as well as litigation matters, solvency and fairness opinions. His broad industry experience includes technology, retail, biotechnology and pharmaceuticals.
Prior to WilliamsMarston, Joseph was a Partner at Bay Valuation Advisors LLC (“BVA”) for 7 years. While at BVA, Joseph advised numerous clients ranging from early-stage venture backed entities to Fortune 100 companies with their complex financial and tax reporting valuation matters. Prior to BVA, Joseph was a Senior Manager in Deloitte LLP’s Transactions & Business Analytics group. While at Deloitte, he served in various capacities including leading the valuation practice for Deloitte’s Technology Venture Center where he worked with numerous early-stage companies. Prior to Deloitte, Joseph provided litigation support at PricewaterhouseCoopers LLP where he assisted companies involved in patent infringement and purchase price disputes by developing complex economic lost profits models to estimate damages.
Joseph holds a Master of Science in Finance from Texas A&M University and a Bachelor of Business Administration degree in Accounting from Texas A&M University.
John Marshall
Partner – Valuation
John brings almost 30 years of valuation advisory experience to WilliamsMarston. His extensive valuation expertise includes mergers and acquisitions, purchase price allocations, goodwill and intangible asset impairments, complex debt and equity instruments, investment management contracts including carried interest and performance fee rights, as well as litigation matters, solvency and fairness opinions. With broad experience across the financial services industry, John specializes in helping investment managers with their most important valuation issues.
Prior to WilliamsMarston, John was a Partner at Bay Valuation Advisors LLC (“BVA”), a nationally recognized leading provider of complex valuation advisory services for more than 4 years. While at BVA, John advised numerous clients ranging from early-stage venture backed entities to Fortune 100 companies with their complex financial and tax reporting valuation matters. Prior to BVA, John led Deloitte LLP’s valuation practice for the investment management industry, advising many of the world’s largest investment managers. Prior to Deloitte, John was a Manager in the valuation practice of another Big Four firm, and prior to that, he worked in a boutique valuation and litigation consulting firm.
John holds a Bachelor of Arts in Government, with a minor in German from Dartmouth College.
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