Valuation is at the core of any financial transaction and is an essential component of the offering. A thorough analysis is conducted to determine the underlying value of the company/division/asset. The task entails creating a robust financial model, which includes:
● Conducting a comprehensive analysis to determine the underlying value of the company/division/asset. The process consists of creating a solid financial model, which includes: Precise financial data in the model (at a granular level)
● Reformulating previous financial data to uncover the business's operational performance
● Benchmarking this performance with the industry’s performance and with the business’s past performance
● Identifying key business drivers and combining financial experience and industry knowledge with management's expertise to forecast these drivers
● Performing detailed projections of the business’s financial statements in consultation with the management based on the future growth and expansion plans
● Valuing the business based on various methodologies including discounted cash flow method, comparable company analysis method, comparable transaction analysis method, etc.
● Conducting a sensitivity analysis to gauge the impact on valuation upon modification in key valuation assumptions
A thorough and integrated 3-statement financial model with precise schedules is included in the output. The entire process serves two purposes: internal assessment and transaction-specific opportunities.