A Fairness Opinion is a document that proves what?

• A. The dividend policy is fair
• B. The deal will close on time
• C. The value is fair from a financial point of view
• D. The company will not be acquired

Answer: (C)

A fairness opinion focuses on whether the financial terms offered in a deal are fair to the shareholders from a monetary perspective. It provides an independent assessment of value, using valuation methods like comparable company analysis, precedent transactions, and discounted cash flow to judge if the price and structure reflect fair value for the target. It does not assess strategic rationale, legal issues, timing, or other non-financial aspects, and it doesn’t guarantee the deal will close or comment on dividend policies or acquisition likelihood. The point is to confirm that the value being offered is fair from a financial point of view.