Transaction Valuations

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Whether considering a transaction as part of a restructuring exercise or to accelerate a growth strategy, more and more businesses are turning to PwC for independent valuation advice as they face increased pressure from stakeholders, including shareholders, independent directors and employees, to justify the pricing decisions that underlie their transactions.

Our transaction valuation team uses a range of analytical techniques designed specifically around the value drivers of a particular industry; this gives our clients and their stakeholders a much better understanding of the value creation potential of a transaction.

With the continued growth of cross border transactions, we are able to combine the expertise of our team in Japan with access to PwC's global network of industry and technical specialists to provide you with the best possible analysis of complex cross-border transactions.

Contact us if

  • You require independent advice on the business or equity value of a target and the key parameters driving such value.
  • You are considering an exit from a business or of a non-core asset and require independent advice to facilitate such exit.
  • You need independent specialist valuation input to validate and challenge your own internal valuation models or models prepared for you by another party, such as an investment bank.
  • You require a financial model to support the pricing, financing and management decision-making associated with a potential transaction.
  • You have a lead adviser and need a second valuation opinion from a truly independent party for management or governance purposes e.g. to satisfy shareholders or other stakeholders that the terms of a transaction are fair.
  • You wish to better understand the key value drivers, risks and potential synergies in a deal.
  • You need to undertake a pre-deal assessment of the impact on earnings of a potential deal to support decision-making and deal communication to stakeholders.
  • You are entering into a joint venture or minority transaction and wish to value a non-controlling stake in a business.
  • You are contemplating a transaction involving the sale or purchase of intellectual property or an early stage company/business.
  • You wish to understand the value of different businesses or assets in your portfolio prior to a group restructuring.
  • You have recently made an acquisition and want to carry out periodic valuations to monitor the value created by the business on an ongoing basis.

How we can support you

Business Enterprise Valuations

Whether you are considering acquiring a controlling stake in a company or exiting an existing business, our valuation analysis can support negotiations and decision making, and provide insights into such important questions as: What is the business worth to you and other stakeholders? What are the critical assumptions underlying the transaction price? Is the business worth more now or can the business be restructured to deliver more value later? How will impending industry and regulatory changes impact the value of the business?

Independent Valuation Reviews

Unlike investment banks that are typically operating on a success basis, we can provide truly independent advice. To provide you with additional comfort when you are negotiating a transaction, we can undertake an independent specialist review of your valuation model or that prepared by another party, such as your lead advisor. This involves critically assessing and challenging valuation methodologies and key valuation assumptions.

Modelling

Most successful transactions are supported by a high quality model (the “deal model”) that facilitates operational and financial forecasting, value driver and synergy analysis, valuation and related sensitivity and scenario analysis, analysis of deal financing options, and the assessment of the impact of the proposed transaction on the post-deal consolidated financial statements of the group, including accretion / dilution analysis. Applying a mixture of strong analytical skills and technical acumen, we design and build robust financial models to help our clients understand the impact of decisions before they make them and strengthen their competitive position. We do this utilizing our dedicated team of modelling experts.

Independent Expert Opinions

We provide independent valuation opinions on the fairness of the terms of a proposed transaction, for governance, legal and regulatory purposes.

Tax Valuations

Our team of dedicated valuation specialists has significant experience in valuing assets and shares for tax purposes. We can provide robust valuations tailored to your requirements that can be used to support the terms of related party and other taxable transactions. Where necessary, we team with tax specialists to optimize the advice that we provide to our clients and reduce the risk of potential challenges by tax authorities.

We also support our clients in the following areas

Pre-Deal Purchase Price Allocation

By integrating PwC valuation specialists into the diligence team, not only can acquirors mitigate the risk of earnings surprises, but the output of a pre-acquisition purchase price allocation can facilitate a more robust transaction valuation analysis and can easily be converted into the post-deal analysis required for financial reporting.

Value Driver and Synergy Analysis

Through detailed analysis of a target’s actual and expected financial performance, we can identify the key value drivers of the business and work with our client to ascertain the potential synergies that might be realized from undertaking a deal, leading to a better understanding of the true value potential of a transaction prior to the submission of a binding offer.

Valuation of Non-Controlling Interests

Our valuation specialists understand the impact of control (or lack of control) and marketability on valuations related to: the acquisition of a minority stake in an unlisted company; entering or exiting a joint venture arrangement; or the buy-out of an existing minority interest.

Valuations of Early-Stage Companies

By obtaining a deep understanding of the value proposition of early-stage companies that may not yet have generated revenues, let alone positive cash flows, and which cannot be valued using the valuation metrics typically applied to mature, stable companies, we are able to assess the value of such companies to both owners and potential investors.

Intellectual Property Valuations

Whether in relation to the acquisition or disposal of intellectual property (such as brands, licenses, patents and know-how), or the licensing of intellectual property to another party, we are able to determine the most appropriate methodology to value such assets and execute such valuations. Where necessary, we work with transfer pricing specialists to ensure a consistent approach to the determination of key assumptions in an intellectual property valuation, such as a royalty rate, to reduce the risk of inconsistencies and potential challenges by tax authorities.

 
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