Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/114634
Authors: 
Schubert, Walt
Barenbaum, Les
Year of Publication: 
1991
Citation: 
[Journal:] Journal of Small Business Finance [ISSN:] 1057-2287 [Volume:] 1 [Year:] 1991 [Issue:] 2 [Pages:] 155-159
Abstract: 
This paper demonstrates that control premiums are warranted in the valuation of closely-held firms when perquisites exist. The value of control is a function of the ownership structure and the size of perquisite cash flows. The conventional logic of assigning control premiums based upon transactions in the public market is shown to be flawed. A statistic for calculating control premiums based on ownership structure and the size of perquisite flows is developed. The paper closes with a short discussion of how minority discounts and control premiums are related.
Subjects: 
Control Premium
Valuation
Closely Held
Small Firm
JEL: 
G32
Document Type: 
Article

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