A business valuation can help you make strategic decisions to improve business performances by pinpointing areas that require improvement. It will also help you avoid disputes and save money on unexpected payouts. It is not just a consideration when you are looking to sell or retire, but it can rather be an excellent tool to identify ways to improve business value. Our advisory team is well equipped to help companies and investors in UAE in determining business value and also assisting them through the transaction. Depending on your specific needs and the prevailing business environment, we adopt appropriate procedures in arriving at our recommendation.
Knowing the value also becomes important at the time of bankruptcy, liquidation, raising funds, or while formulating Company exit strategies. As Company valuation advisors, Kloudac provides you with all the assistance that you need to calculate the intrinsic value of your business, using various financial methods, such as net asset value and discounted cash flows method.
Benefits of Business Valuation Services
Enhance and Evaluate
A business valuation helps you to gain a clear idea of your business. It helps in increasing the goodwill and evaluate the present value according to the market conditions.
Magnet for Investors
Business valuation presents the company’s worth; and having a high worth would ultimately attract investors towards your business to a great extent, leveraging the growth opportunities.
Easier Loan Approval
Possessing knowledge about your company’s worth will build trust in the minds of the financial institutions and will help you to grab an easy loan from the market for future expansion.
Acquisitions and Mergers
Knowing the accurate value that your business holds helps you to have an upper hand over other businesses at the time of merger or acquisition.
Decision-Making Tool
Once you know the value of your business, it will act as a decision-making tool that helps you to make long-term decisions regarding your business development
Company Restructuring
Valuation reports contain the core details of company assets and liabilities. They contain the company’s present worth, and ultimately this helps in restructuring the company as and when required.
Main Approaches used in Business Valuation
This approach involves the actual verification of assets in the entity and the computation of the value of these assets. In this method, the value is obtained by reducing the value of total liabilities from the total net asset value, as found in the balance sheet. We apply this method in the case of asset-heavy valuations and work with qualified technical valuers.
In the Market-Based approach, data from comparable transactions – ideally within the same sector and the same region is used in order to arrive at valuations that have been obtained for companies. This approach can be used in a stand-alone manner only if there are such comparable transactions that have occurred in the recent past and also if there is reliable data available for these transactions in order to perform a meaningful analysis
In this method, the business value is dependent on its ability to generate earnings in the future. This method is generally used when investors contemplate their decision to invest in your company. Before investment, investors must know the return on investment that they would receive.
The evaluator calculates future income based on past figures of expenses, sales, profits, and other important numbers and trends. Investors are also interested in knowing the time taken to recover the original investment amount, the expected additional amount generated from the business, and if any other business is generating more ROI compared to the subject company.