This week we’ve seen two instances of why private market assets require credentialed 3rd party marks. First, Petco went public, again, soaring 60% as soon as stock traders could get their hands on it. That means the PE firm undervalued their asset.

Then, in the oil patch, we see a more egregious example. The WSJ: “The SEC launched an investigation of Exxon Mobil after an employee filed a whistleblower complaint last fall alleging the energy giant overvalued one of its most important oil & gas properties.

Several people involved in valuing a key asset in the Permian Basin, currently the highest-producing U.S. oil field, complained during an internal assessment in 2019 employees were being forced to use unrealistic assumptions about how quickly the company could drill wells there to arrive at a higher value, according to a copy of the complaint, which was reviewed by the WSJ. At least one of the employees who complained was fired last year, according to a person familiar with the matter. The Journal previously reported that there had been internal disagreements over the valuation.”

Inveniam, in tandem with our accounting & valuation partner experts, provides reliable, consistent, trusted, verifiable independent marks. Verified private data and 3rd party marks matter.

Read the full post on LinkedIn