Minority Interest (NCI)

The older name for non-controlling interest: the portion of a consolidated subsidiary the parent does not own. The standards renamed it in 2009, on the logic that a minority holder can still control and a majority holder can lack control. Bankers, deal documents and most interviewers still say minority interest. The treatment is unchanged either way: it is added in the enterprise value bridge, because consolidated results include 100% of the subsidiary while equity value carries only the parent’s share.

Current nameThe standards call it Non-Controlling Interest (NCI), and the mechanism, the worked case and the interview question are there.

Where Minority Interest (NCI) comes up

How to Build a DCF Model: Build Order, Terminal Value and the Sanity ChecksA DCF is 70% terminal value and 100% assumptions. Build it so both can be defended.Read the guide — 12 min Enterprise Value vs. Equity Value, Once and For AllThe most-asked valuation concept in finance interviews, and the bridge, pairing rules, and follow-up traps that come with it.Read the guide — 7 min

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