V5 N1 Paper 1
Annals of the International Masters of Business Administration at UNC Wilmington
Spring 2012

An Empirical Examination of the Marketability Discount on Closely Held Companies  

Johannes von Olfers

Committee

Peter Schuhmann
Edward Graham

Abstract

This paper measures the marketability discount for closely held companies and provides new evidence regarding the size of this discount. The comparison of ratios between private and public companies of a certain industry will estimate the discount. Although the ten factors of the Mandelbaum case are the basis of this examination. Furthermore, the paper examines key variables that impact the size of this discount. The result due to the data set of private and public transactions in the last three years is a premium of 45,58%. The premium reflects the fact that an overall or benchmark marketability discount with a few assumptions cannot perfectly predict a marketability premium or discount.

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Recommended Citation: von Olfers, J., Farinella, J, Schuhmann, P., Graham, E. (2012) An Empirical Examination of the Marketability Discount on Closely Held Companies. Annals of the International Masters of Business Administration at UNC Wilmington, 5(1) paper 1. http://csbapp.uncw.edu/data/imba/current.aspx.

V5 N1 Paper 1
Annals of the International Masters of Business Administration at UNC Wilmington
Spring 2012