Business valuation

BrightOrangeTalanton specializes in valuing companies. The context in which this is done largely determines the depth of the analysis, the volume of the report and the specific methods and techniques which are used.

Examples valuation context:

• Orientation on possible sale of a business;
• Fiscal restructuring;
• Impairment test of a business;
• Foundations of damage;
• Independent valuation in the context of legal proceedings

BrightOrangeTalanton has extensive experience with the most extensive and complex valuation issues in various situations.

Business valuation methods
There are various methods for valuing your business. Two common methods are:

Discounted Cash Flow
BrightOrangeTalanton will use the discounted cash flow method, also known as DCF method. In this method, future cash flows will be discounted with the cost of capital. The DCF method takes into account the factors of time, money, uncertainty and risk and is considered to be the most appropriate method for determining economic value in the financial and economic practices.

The DCF method is the only valuation method where it is necessary to assume complete information about the company being valued. The method forces the user to apply a long term vision on expected future cash flows and the appropriate capital structure. The limitation of the Wacc variant "of the DCF method is that a fixed leverage ratio implies, which is not always realistic in practice and which makes it difficult to take losses into account from tax effects.

Capital Cash Flow
The Capital Cash Flow method (CCF) is a variant of the DCF method. The CCF method is based on the projected capital structure and includes the tax advantages in the cash flows instead of processing these advantages in the cost of capital. This gives a clearer insight into the creation of value. If the methods are applied correct and the same information is used, the value-result of both valuation methods are identical.

Reflecting other company valuation purposes
Besides following a valuation of transactions, there are other purposes for which you should analyze your business value, including the context of reporting. There are regular events take place where the economic value of a company is relevant as a fiscal tax base. Adequate support to the valuation is of critical importance. You should consider advice and guidance by the independent experts of BrightOrangeTalanton.