Selling or acquiring

Independent business valuation

Independent valuations using recognised methods (DCF, multiples, asset-based).

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“Valuations are there to show where you really are, not where you would like to be.”

Michele Collini · ACCA Member
The service

What it covers

Business valuation

When you need it
An offer received, a shareholder exiting, business succession, a dispute.
What you receive
Valuation report with methods, assumptions and value range.
Not included
Sworn appraisals and attestations, unless specifically engaged.
Indicative timing
3–5 weeks from receipt of the complete data.

How a business valuation works

  1. Initial reviewReview of the latest financial statements and most recent management accounts, and definition of the purpose: sale, new shareholders, generational transfer or dispute.
  2. Normalising the numbersEBITDA adjustments for non-recurring items, off-market directors’ pay, personal expenses and related-party contracts.
  3. Applying the methodsDiscounted cash flow (DCF) with a reasoned discount rate, multiples of comparable companies and transactions, and the asset-based method for capital-intensive businesses.
  4. ReportA value range, sensitivity to the key assumptions and a written report that can be used with buyers, shareholders, banks and legal advisers.

Documents for the valuation

  • Last three approved financial statements
  • Up-to-date management accounts
  • Budget or plan for the current year
  • Breakdown of financial debt, leases and employee severance liabilities
  • Main contracts with customers and suppliers
  • Any appraisals of property and plant

What affects timing and value

  • Quality and timeliness of the accounting data
  • Revenue concentrated on a few customers
  • How much the business depends on the owner
  • Stability of margins in recent years
  • Level of debt and working capital needs

Common mistakes

  • Applying an “industry” multiple without adjusting it to the size and risk of the business.
  • Confusing the value of the business (enterprise value) with the value of the shares (equity value).
  • Not normalising EBITDA before applying multiples.
  • Approaching a buyer without a valuation that can be defended figure by figure.

Business valuation FAQs

What is the difference between a valuation and a statutory appraisal?

A valuation supports decisions and negotiations. A statutory appraisal is required by law in certain corporate transactions, such as contributions in kind, and follows its own rules.

Do I need a valuation if I am not selling?

Yes: it is the basis for bringing in new shareholders, for generational transfer, for negotiations with banks and for measuring whether the business is creating value.

How long does it take?

It depends on how complete the documents are and how complex the company or group is. The timing is set out at the start of the engagement.

Is the information kept confidential?

Yes. Documents are treated confidentially and, on request, a non-disclosure agreement is signed before they are received.

Read more: Financial due diligence →Generational transfer →Normalised EBITDA in a sale →

First step

Request a sale readiness review

Indicative value, due diligence issues and work to complete before going to market, with a written outcome.

Request a sale readiness review →

Further reading: Business valuation: DCF, multiples or asset-based approach? →

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