Business Valuation

Christophe Thibierge and Andrew Beresford
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Christophe Thibierge: ESCP Europe
Andrew Beresford: ESCP Europe

Chapter 6 in A Practical Guide to Corporate Finance, 2015, pp 158-194 from Palgrave Macmillan

Abstract: Abstract Knowing how to value a business serves multiple purposes. First of all, this knowledge is used when selling a company, either wholly (outright sale) or partly (selling shares, issuing new shares). It is also useful when buying a company from your friends, in order to fine-tune your price negotiations. The value of your own company can also be used as collateral when taking out a large loan. Finally, to do a business valuation properly you have to ask some fundamental questions: Where does the company’s performance come from? Is it long lasting? What is the level of risk in its various business activities? How much would a financier’s expected return be?

Keywords: Discount Rate; Cash Flow; Balance Sheet; Free Cash Flow; Market Value (search for similar items in EconPapers)
Date: 2015
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Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-1-137-49254-8_7

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DOI: 10.1057/9781137492548_7

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