The valuation of a company normally values the business as a going concern and takes into account the assets of the business ("soft" and "hard") and the ability to monetise the companies' intellectual property, products and operations (eg. forecast revenue and EBITDA).

Detailed information may be needed to make an investment decision, for example financial statements; a business plan; information about ownership of intellectual or industrial property; or expert opinions including valuations or auditors' reports. Investors should make their own enquiries and evaluations they consider appropriate to verify the information contained in any Offer Document and to determine the suitability of an investment in the Company (including regarding their investment objectives, financial situation, and particular needs) and should seek all necessary financial, legal, tax and investment advice.

Questions investors may also ask include:

  • What is the company's competitive advantage?
  • What is the strength and quality of the management team? Can they execute?
  • How is the business performing from a revenue and profitability point-of-view?
  • What is the exit and expected price-to-earnings multiple on exit?

As there are many factors that influence the valuation, the price paid for securities will always be a matter for negotiation between the parties.

If you have queries regarding a particular valuation please contact us.