Valuation for Fairness Opinion
A fairness opinion is required in M&A Transactions to give an independent objective and financial analysis, as to the fairness of Share exchange ratio / Share entitlement ratio in case of a merger/ amalgamation or purchase consideration payable in case of an acquisition.
Fairness opinion is either mandated under regulatory provisions or is undertaken as a good corporate governance practice. Rigorous asset valuation is one of the key elements in producing fairness opinions.
At RNC Valuecon LLP, we are a leading valuation firm with years of experience in delivering detailed, diligent, and well-supported fairness opinions and valuation services that are unbiased, credible, conflict-free, and will hold up under third-party scrutiny.
While issuance of a fairness opinion, a professional financial valuation is required to ensure that public shareholders or minority shareholders of the transferor and transferee companies are not being prejudiced by the valuation so arrived and that the asset valuer has applied valuation methods on a relative basis. The objective is to eliminate any biases towards and favour to the promoters or their associated entities.
In case of Listed Companies, the Fairness Opinion is required on the valuation of assets/equity shares of the listed as well as the unlisted company by the valuers from an independent merchant banker under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
RNC can provide independent fairness opinions to the Board of Directors / Management of the companies in connection with their proposed transaction. The experience of our expert financial valuation team includes providing fairness opinions for mergers and acquisitions, amalgamations, demergers and scheme of arrangements (through our associated entity which is a SEBI registered Category I Merchant Banker).
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Valuation of specified assets on behalf of the Board Members.
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What is a fairness opinion?
A fairness opinion is an independent professional opinion assessing whether a transaction is financially fair from a valuation perspective.
When is fairness opinion required?
Fairness opinions are commonly used during mergers, acquisitions, restructuring, related party transactions, and strategic financial decisions.
What is the difference between valuation and fairness opinion?
A valuation determines business value, while a fairness opinion evaluates whether the transaction itself is financially fair.
Who uses fairness opinions?
Boards, audit committees, investors, legal advisors, listed companies, and corporate stakeholders commonly use fairness opinions.
Is fairness opinion mandatory in India?
Requirement depends on transaction type, governance standards, regulatory framework, and stakeholder expectations.
Why are fairness opinions important in related party transactions?
They help improve transparency, reduce governance concerns, and support independent review.
Can fairness opinion help reduce transaction disputes?
Independent fairness assessment may strengthen transaction defensibility and reduce pricing disputes.
What transactions require fairness opinion support?
Mergers, acquisitions, share swaps, strategic investments, restructuring, and promoter transactions commonly use fairness opinions.
Do fairness opinions include valuation analysis?
Yes. Valuation review is typically one component of fairness opinion analysis.
Does RNC provide fairness opinion services across India?
Yes. RNC supports clients across India for fairness opinion and transaction valuation assignments.