The Asset Management company wanted to provide a purchase price and asked PH Global Advisor to analyse the different valuation methods and provide with a recommendation.

The different steps consisted of:

  • Gather all information available
  • Test its reliability
  • Provide a detailed ID card of the company
  • Analyse the Assets in terms of provenance, age, types of contract
  • Analyse the customers in terms of concentration and average scoring risk
  • Analyse the different components of the revenue and provide for each one a value
  • Calculate the Net Book Value of the equipment and its Fair Value
  • Analyse the different components of the debts attached to the equipment
  • For the ancillary segments, provide a value using the EBITDA method (benchmarked with competitors)
  • Analyse the revenue stream of each segment
  • Provide solid assumptions on Utilisation, renewal and deflation
  • Provide value of the revenue stream with a discount rate (benchmarked)
  • Calculate the liquidation value
  • Highlight red flags in financials and operations
  • Provide with a reasonable range of valuation using different methods

As a result:

The in-depth research on all aspects of the company and its Assets was a background document for the negotiation.

The Asset management company acquired its smaller competitor at a reasonable price. Both companies are operating. 

Management of the acquired company improved with the help of the identification of red flags by PH Global Advisor