Author's profile

Rui Albuquerque
Boston University

Background

Author articles

  • An inherent difficulty in estimating the value of large blocks of shares is the need to account for their limited marketability. To date, there are no estimates of the marketability discount that explicitly take into account the illiquidity of the market for corporate control. In this article, results from previous work by the authors are used to produce a simple method to estimate the marketability discount under different firm, industry and macroeconomic scenarios. This method is applicable to public firms that have non-traded controlling blocks of shares, as well as fully private firms, and it helps investors determine what discounts to apply on top of the more traditional valuation methods (multiples based methods, DCF analysis).

    10/02/2017 | 9,053