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TARGET BUSINESS CONSULTANTS

 

 

Frequently asked Questions

 

F: What is the price I can achieve in selling my business?

A: The Enterprise Value of a company will be calculated based on the expected cashflows in the future. Many different methods are available. For a profitrate of 15% on equity usually the multiples on EBIT (Earnings before interest and tax) will be depending on the growth potential in the range of 5 to 9. The purchase price (value of equity) is Enterprise Value minus debts plus nonoperating assets.

On the other hand the value of a business is as high as someone is prepared to pay for. For declining markets possibly no buyer will be found. 

For companies in special situation (lack of liquidity) specialized investors are willing to invest if the situation is understandable and a consistent plan for the future is available.

F: I want to grow my business by acquisitions?

A:
Acquisitions can be done purely opportunistic in case opportunities appear. To strenghten certain market sectors or to access new technologies it is advisable to take an active approach to potential acquisitions.