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How much is your company worth?

When performing a valuation assessment, we start with a general analysis of the company, including its commercial foundation, and look at the market conditions, the make-up of its customers and suppliers etc. We look at the company’s products, services, production, and also assess its management, skills and basic company-specific factors. We conduct a thorough analysis of the company’s financial situation. In addition, we assess the level of interest among potential buyers within the industry in question, as this has a key bearing on the company’s value.
Based on our company analysis, we work out a tangible valuation assessment using reputable tools and models, as well as databases.

This may, among other things, include:
  • The normalisation of earnings, separating property from the calculation etc.

  • Calculation of value according to the discounted cash flow (DCF) model and the EBIT multiple model.

  • Calculation of the substantial value.

Our process

Important factors of relevance to company value

All businesses are different. History, prospects and general conditions are all relevant when valuing a company. Does the company, for example, have a couple of very large customers who account for most of its revenue, while the rest of the customers are thinly spread out, and what does this mean for value and risk? And if several big investments have been made which are not yet reflected in the earnings, how do you take this into account?

In one scenario, a company may have enjoyed high earnings for several years, but over the past year or two they have fallen – how do you make the valuation? Perhaps the company has grown very rapidly, and, therefore, earnings have grown dramatically in recent years, so it may be difficult to arrive at a value. Or how is the valuation affected if the owner performs all the managerial functions, and there is no management group beneath them?

Our financial analysis involves a review of the financial statements. The income statement and balance sheet including liabilities are included in the analysis, and if budgets have not been prepared, we estimate the level of revenue and earnings.

Value calculation

All factors that we have listed on this page are included in the valuation calculation. We base our calculations on well-established methods, which are all based on the company’s earnings and balance sheet. We apply several different methods to cross-check the valuation assessment. We compare the figures with any registered company transactions in the same line or related lines of business. We look at the facts in light of our market knowledge and our ongoing dialogue with investors, banks, accountants etc. In this context, we also assess the saleability of the company.

The valuation assessment cannot factor in potential synergies that may be realised, for example, if the company is bought by a competitor, which can lead to savings or greater earnings through a business combination. Synergies are dependent on who the buyer is. We are happy to advise on how potential synergies can be valued if there is a concrete buyer for the company. The value assessment is thus based on the company as an isolated entity.

Written report

The total value assessment, background, observations and assumptions are compiled in a report for the company’s management/owners.

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