Before anyone can negotiate over a business, someone has to say what it’s worth — and in a divorce, that number is contested terrain from the moment it’s spoken. Here is where valuations come from, and where they’re really fought.
The Approaches
Valuers fit the method to the business: trading companies are typically valued on earnings — a multiple applied to maintainable profits; asset-heavy companies (property-holding, investment) on their net assets; and some sectors carry their own conventions. In a divorce, the valuer is usually an accountant instructed for the purpose — sometimes one jointly agreed, sometimes one each side with the difference to be resolved — working from the accounts, management figures and the story behind them.
Where the Fights Live
Rarely in the method; almost always in the inputs. Maintainable earnings: are the recent lean years the new reality or a conveniently timed dip? Is the record year an outlier or the trend? The owner’s remuneration: salary is only the visible piece — pension contributions, vehicles, expenses and family wages all belong in the true picture of what the business yields its owner. The multiple: what a real buyer would pay for a business this dependent on its owner — the discount for a company that is really one person with staff can be substantial, and owners and spouses discover opposite enthusiasms for that argument. Marketability: paper value a shareholder can’t realise is worth less than the same figure in cash, and minority stakes carry their own discounts.
Both chairs, one discipline: owners protect themselves with organised, early, honest figures — credibility is the currency every later argument spends. Spouses protect themselves by testing the numbers independently — the company’s sudden pessimism as the marriage ends is a pattern valuers know well.
Valuation Is the Start, Not the Answer
The figure feeds the proper-provision analysis; it doesn’t conclude it. Courts weigh the business’s value alongside its role as the family’s income source, and provision is routinely structured to keep the enterprise alive — the full treatment is on the Business Owner Divorce page. But every structure is only as honest as the number it’s built on — which is why the valuation stage deserves the seriousness it gets here.
A business in the middle of a separation — on either side of it? One confidential call on 01 5827148 starts with the numbers.