Brattle Consultants Author Chapter on DCF Method Alternatives for Capturing the Value of Management Flexibility
Published in Lexology In-Depth: Investment Treaty Arbitration – Edition 10
Brattle consultants recently authored a chapter for Lexology In-Depth: Investment Treaty Arbitration – Edition 10 on capturing the value of management flexibility.
The flexibility retained by managers to respond to changing circumstances creates economic value by enabling parties to capture upside when conditions are favorable and avoiding or limiting downside when they are not. In arbitration settings, practitioners routinely use the discounted cash flow (DCF) method to estimate damages. In this chapter, the authors discuss alternatives to the DCF approach that have been adopted by practitioners outside of arbitration and determine whether and when such alternative valuations can be credible and useful in an arbitration setting.
The chapter, “Beyond DCF: Capturing the Value of Management Flexibility,” was authored by Principal Richard Caldwell and Senior Associates Benjamin Lawrence and Piero Fortino.
