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Valuations
There are many factors that impact the value of a company. There are also several definitions of value that are used for various purposes. Included in these definitions are: income value, intrinsic value, fair market value, liquidation value, going concern value, as well as enterprise value. When preparing a company for sale, the ultimate goal is to promote the intrinsic value in a way that will optimize the enterprise value. This, in turn, will maximize the market value of the company at time of sale.
The enterprise approach is typically used for small and medium-sized companies that are privately held ($1 to $100 million in sales), and is almost universally used when dealing with manufacturing, distribution and service companies. There are, however, certain businesses and situations where an alternative approach is more appropriate. Different buyers will often place different valuations on the same company. A key feature in determining these valuations is the ability to generate cash (EBITDA) in the future. While this formula remains the primary determinant of value, there are a host of additional factors that will impact the enterprise value as well.
As professionals of Leiden Capital Group, we pride ourselves on our ability to help business owners optimize the value of their business. We further feel strongly that anything short of a presale optimization process is a disservice to the client and leaves value on the table at time of exit. Our Business Value Optimization Program is consistently applied to all of our engagements and our reputation in the marketplace justifies the success of the program. The first step of the program, and part of our valuation process, is to recognize the state in which your company is in to determine the optimum time to exit. Identifying the state of the business up-front enables us to set a realistic timetable and project plan for maximum value at exit. In addition to identifying crucial value building blocks, Leiden Capital Group also addresses pitfalls of value; a very necessary process for anyone contemplating the sale of their business.
For more information or to team-up with Leiden Capital Group to start optimizing the value of your business, please contact us. We look forward to working with you.
Consulting
Leiden Capital Group has extensive experience across multiple different industries and represents over 25 years of expertise in helping sellers maximize their market value at time of exit. Our principal advisors and consultants maintain specialized experience in a variety of different areas of expertise. Included in these are CEO and CFO experience, Fortune 500 level management experience and seats on multiple corporate boards.
As specialized consultants to closely held business owners, clients of Leiden Capital Group gain access to consulting expertise that is truly best in class. Our consulting process is team-driven and focuses on identifiable results. We recognize the life-cycle of a business has many stages and the issues facing business owners are often extremely complex. This requires dedicated expertise to remedy existing deficiencies and identify opportunities for growth. For these reasons, we utilize the unique expertise of each of our professionals to deliver truly valuable advice.
Whether the business is in a growth or disposition phase, our clients realize the advantages of an experienced and extremely successful team-driven approach. This approach, coupled with our Business Value Optimization Program assures our clients a successful and rewarding transaction.
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