Root Valuation

When a claim of wrongdoing is leveled against your healthcare organization, the disruptions can be significant. Patient care may be compromised, and you may risk significant economic and reputational damage if not resolved.  Our financial experts can work with counsel to help assess potential damages, develop a rebuttal of claims, and if necessary, provide informed and compelling expert testimony. Our litigation support services include, but are not limited to:  ✅ Shareholder Disputes ✅ Breach of Contract ✅ Business Interruption ✅ Non-Compete Litigation ✅ Qui Tam Defense ✅ Marital Dissolution Schedule a call today: https://lnkd.in/gHQer3pa  #healthcarevaluation #valuation #healthcareadvisoryservices #advisoryservices #litigationsupport 

We recognize that you have many choices when it comes to selecting a healthcare valuation firm. At Root Valuation, our mission is to provide a unique client experience — one that brings a personalized, hands-on approach tailored to your objectives and centered around our four core values:       ✅  People First      ✅ Excellence     ✅  Solution Oriented      ✅ Do the Right Thing      Learn more about our values and explore how Root Valuation can help your organization today: https://lnkd.in/g8bm6H4j  #healthcarevaluation #valuation #healthcareadvisoryservices #advisoryservices 

At Root Valuation, we help healthcare organizations navigate fair market value in an ever-changing regulatory and business environment. Our dedicated and experienced valuation experts provide the data and support to guide your business decisions and reach your long-term objectives. Learn more: #healthcarevaluations #valuations #fairmarketvalue #mergers #acquisitions

We've been receiving numerous inquiries from clients who are revisiting their policies and procedures to ensure alignment with federal Anti-Kickback Law, the Stark Law, and other relevant regulations. If you're navigating similar concerns, check out these helpful insights from Mark Spurlin, CPA: https://lnkd.in/gG4HXFKG #HealthcareLaw #HealthcarePolicy

Celebrating our colleagues, friends, and caregivers across the 5,000+ hospitals, health care systems, and connected healthcare networks this week for American Hospital Association National Hospital Week. Thank you for all that you do!

So you've been offered $5,000,000 for your Practice, but are you sure you understand what that means for your bank account? Enterprise Value = This is the total value of your business Equity Value = This is the Enterprise Value minus outstanding debt Most purchase offers are expressed in terms of Enterprise Value (e.g., a multiple of EBITDA). This purchase price normally assumes that the seller will pay off any outstanding debt at closing. So if you have an offer of $5,000,000, but your Practice has $2,000,000 of debt, you will only net $3,000,000 from the sale. Think of it as selling a home that has a mortgage, your proceeds (equity) are what is left after paying off the bank (debt). However, if the offer is expressed in terms of Equity Value the buyer will assume all of the assets and debt of the business and the purchase proceeds will go directly to the seller (minus certain closing costs, etc.). So if you have been offered $5,000,000 for your equity stake, you will receive that amount at closing. Equity values are less commonly referenced for acquisitions of an entire business, but equity values are always the prices stated for fractional ownership interest in a business (e.g., selling shares). Not fully understanding the difference between Enterprise Value and Equity value can lead to significant misunderstandings regarding your Practice valuation and the proceeds that will ultimately be received in a sale transaction. #fairmarketvalue #mergersandacquisitions #docdeals

Jason Ruchaber, CFA, ASA shares his thoughts on the role of the expert in economic damages calculations #disputeresolution #economicdamages https://lnkd.in/dny5_Xpv

What is a discount rate? A discount rate, expressed as a percentage, is the rate of return required by investors or lenders committing capital to a business. It is referred to as a "discount rate" because this rate of return is used by appraisers to discount expected future cash flows to their present value in their valuation models. The discount rate is comprised of two primary elements, the cost of equity capital (investment) and the cost of debt capital (borrowing). These two elements are combined at a ratio known as the capital structure (e.g., 70% equity / 30% debt), with the resulting value referred to as the weighted average cost of capital or "WACC". Why is this important? Well all things being equal, a higher estimate of WACC will result in a lower indication of value (and vice versa). And as one of the most critical components of an appraisal, the development of WACC should not be arbitrary. WACC should reflect the prevailing rates of returns on equities and the interest rates on debt, a thorough analysis of the risk factors specific to the subject entity (or investment), and the prevailing (or most likely) capital structure for the business. All of the above factors should be well supported and documented in your appraisal, and failure to do so may result in an erroneous indication of value. Have a question about discount rates, post your comment below. #fairmarketvalue #valuation #healthcare

Please join us in welcoming David Walline to the Root Valuation team!

Should you buckle down and work harder to increase the value of your Practice prior to a sale? This is a question that was recently posed to me by a client in discussions for a sale of their business. My answer was probably a bit unsatisfying, "it depends." Buyers are concerned about the sustainability of earnings, not temporary peaks or valleys that may result from short-term efforts or other non-recurring items. This is why many buyers commission a quality of earnings analysis to validate reported results and normalize both income and expenses. As such, if your business sustained a longer term dip (e.g., post COVID) and you are just recently started operating a level more consistent with future expectations for the business, demonstrating that the recent (improved) performance is sustainable may translate into a better valuation of your business. But if the effort is temporary and unsustainable, buyers will generally see through the smoke and it will have no meaningful impact on purchase price. If you are contemplating a sale of your business, it is a good idea to start planning 2-5 years ahead of your desired transaction date. Working with an advisor like @RootValuation can help your business get its financial house in order, identify potential value enhancement opportunities, and prepare for a streamlined diligence process that will be attractive to potential buyers. #physicians #valuation #fairmarketvalue