Valuation and Diligence

Valuation

1. Types of Buyers
2. Position (minority vs controlling; marketable vs non-marketable)
3. Enterprise value vs. Invested Capital vs Equity
4. Methodologies and why some are more applicable for different purpose (Asset, Market, Income approaches)
5. Data Needed (historical, projections)
6. Selecting Guideline Companies
7. Selecting Guideline Transactions
8. Understanding other Transactions in the Company’s Stock
9. Walking Through Market Approaches
10. Understanding What the Multiples Mean
11. Walking Through Income Approaches
12. Discount Rates
13. Walking Through Asset Approaches
14. Pros And Cons of the Valuation Methodologies

Diligence

1. Gaining Access into the Company’s Financials and Operations
2. Ins and Outs of the Data Room
3. Different Types of Diligence

• Financial – Normalized Ebitda
• Tax – SALT, Sales and Use Tax, Any Other Tax Liabilities
• Operational
• Customer Concentration
• Market Share / Market Studies
• Insurance
• Legal
• Cyber – who can get into the system?

Maybe not done on every deal; why it would or would not be done for certain deals or points would be selected or not selected.