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The valuation of shares necessarily involves making assumptions about the future, because what a purchaser will pay for the shares in the open market depends upon the expected benefits, in the form of dividends or directors' remuneration, or capital by way of capital distribution, a take-over bid, a public flotation or a liquidation.

Unquoted shares are those that are not quoted. For the meaning of quoted shares, see the introduction to I8.301.

All valuations require the valuer to take a view about the state of the nation, both politically (the possibility of nationalisation, limitation of dividends, restriction on borrowing, price controls, etc) and economically (the purchasing power of the population, the cost of borrowing or lending money, etc), of the industry or trade in which the company operates, and of the performance of the company itself in relation to its competitors.

The difficulties are illustrated by the values put forward by the expert witnesses in a leading case, which ranged from £2 to £6 per share¹. It should,