Transition Planning - (Sellers/Second Edition)

VALUATION - RISK & REWARDS
IT’S ALL ABOUT VALUE
Pavilion has a team of highly qualified professionals who utilize various
methods for conducting valuations.
We recognize that a sound valuation will be based on all the relevant
facts including the elements of common sense, informed judgment
which must enter into the process of weighing those facts and
determining their combined or cumulative significance.
“
The value of a thing is the amount of
laboring or work that its possession
will save the possessor.
- Henry George
“
In addition, Pavilion has further resources that help smaller and midcap
clients optimize their current “fair marketplace” value.
INTERNAL VALUE DRIVERS
Our team works closely with sellers to assess the business internal
“value drivers” that ultimately determine the Enterprise Value in the
marketplace. In addition, we utilize real time access to the following
resources:
4 Precedent database of completed transactions across North
America that provide evidence to support the valuation.
4 Real time access to the financial performance in each SIC or
Industry sector to enable an independent “yard stick” for key
performance indicators (KPI’s).
4 RMA Ratio’s – The Risk Management Association provides a wide
range of metrics that we use to assess the business and provide a
“score card”.
The true indicator of a company’s success is measurable by a wide
range of factors. One of the main components is the financial metrics
of the business including the Profit and Loss statements and Balance
Sheet performance. While this is a key financial metric, there are
numerous other factors that enhance enterprise value.
“
4.
Normalization of financial statements and
assesment as to future maintainable earnings
2.
Risk Profile
(internal/external)
7.
Valuation
Conclusion
6.
Transaction reviews
including the number of
buyers and sellers
market sector
5.
Application of valuation
approaches and methods
3.
Future Opportunities/
Growth Potential
1.
Collection and analysis of all relevant information
necessary to support the valuation conclusion
Everything that can be counted does not
necessarily count; everything that counts
cannot necessarily be counted.
- Albert Einstein
“
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TRANSITION PLANNING GUIDE