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Valuation Multiple
 

Valuation Multiple

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A valuation multiple indicates that a company’s market price has been established at X times its sales, or X times its earnings by Evaluation

A valuation multiple indicates that a company’s market price has been established at X times its sales, or X times its earnings by Evaluation

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    Valuation Multiple Valuation Multiple Presentation Transcript

    • Strictly Private and Confidential www.e-valuation.us VALUATION MULTIPLES REPORT [XYZ Sector] January 2010 New York - London – Miami - Madrid
    • Strictly Private and Confidential JANUARY 2010 XYZ COMPANY – Valuation Multiples Report www.e-valuation.us e-Valuation Multiples: Description E-Valuation uses professional databases about transactions, as well as about worldwide quoted companies. Thanks to our analysts´ experience and the tools used, e-Valuation can offer a customized service about comparable multiples in your company sector. It will permit to dispose of a multiples range of the same activity or as comparable as possible. The table of comparable multiples will offer the following information:  Transaction price - whenever it is available  Acquired stake percentage  Currency in which price and financial information are stated  Price interpretation, that is to say whether it refers to equity or enterprise price  Payment form (cash, shares exchange, debt holding, etc.)  Number of employees of the acquired company  Enterprise and equity Valuation of the acquired company  Company´s principals financial data (sales, EBIT, EBITDA, net income, net debt) - whenever they are available  Valuation multiples resulting from the previous information (Enterprise Value / Sales, Enterprise Value / EBIT, Enterprise Value / EBITDA, y PER). 2
    • Strictly Private and Confidential JANUARY 2010 XYZ COMPANY – Valuation Multiples Report www.e-valuation.us e-Valuation Multiples: Summary Table EXAMPLE Strictly Private and Confidential Occurred Transactions in Vehicles Retail Distribution´s Sector between 2007 and 2009 in Europe Multiples Target Bidder Enterprise # Country Currency Date Activity Description % Stake EV/Revenue EV/EBITDA1 EV/EBIT2 PER Company Company Value (m) Swedish retailer of vehicles and provider 1 Company 1 Company A Sweden EUR 07/04/2009 100.0% 11.4 0.17x - - - of related services Spanish vehicle retailer specializing in 2 Company 2 Company B Spain EUR 13/02/2009 - - - - - - Fords 3 Company 3 Company C Spain EUR 31/12/2008 Spain based auto dealer - - - - - - UK based automotive supplier. The bidder Group has got around 30 years of 4 Company 4 Company D United Kingdom GBP 23/05/2008 100.0% 6.4 0.18x 18.2x 25.4x 38.1x experience in luxury vehicles retail business. UK based firm sells, hires and services 5 Company 5 Company E United Kingdom GBP 04/05/2008 50.8% 13.0 0.11x - - - Ford vehicles. 6 Company 6 Company F Spain EUR 01/05/2008 Spain based car dealer of Peugeot firm 76.0% - - - - - Russian car dealer. Operates with firms 7 Company 7 Company G Russia EUR 24/04/2008 100.0% 446.3 1.09x - 28.2x - like Land Rover, BMW or Jaguar. Spain based company engaged in 8 Company 8 Company H Spain EUR 13/03/2008 - - - - - - automotive dealership business UK based motor distribution company. 9 Company 9 Company I United Kingdom GBP 03/10/2007 Works with firms like Audi, Alfa Romeo, 46.7% 60.0 0.14x - 20.0x - Chrysler, Citroën, Jaguar, Ford, Jeep,… UK based dealer of cars and vehicle # Company 10 Company J United Kingdom GBP 02/05/2007 100.0% 7.1 0.12x 12.2x 16.4x - service centre operator. UK motor vehicle retailer. Operates with # Company 11 Company K United Kingdom GBP 27/02/2007 new and second hand vehicles, camions, 58.0% 69.0 0.12x 10.3x 14.4x 12.5x caravans and bicycle. AVERAGE 0.28x 13.6x 20.9x 25.3x Nota 1: EBITDA = Earnings Before Interest, Taxes, Depreciation and Amortization MEDIAN 0.14x 12.2x 20.0x 25.3x Nota 2: EBIT = Earnings Before Interest and Taxes MAXIMUM 1.09x 18.2x 28.2x 38.1x MINIMUM 0.11x 10.3x 14.4x 12.5x 3
    • Strictly Private and Confidential JANUARY 2010 XYZ COMPANY – Valuation Multiples Report www.e-valuation.us e-Valuation Multiples: Information Sources  e-Valuation uses numerous public information sources, both in Spain and abroad, in order to dispose of as much operations as possible. Additionally, our subscription to several commercial register in various countries allow us, when the price is published, to buy the acquired or merged company´s financial statements in order to calculate its valuation multiples.  In case we estimate necessary, we get in touch with the target company to confirm the data which has been published in our information sources, giving better reliability to the data we use. 4
    • Strictly Private and Confidential JANUARY 2010 XYZ COMPANY – Valuation Multiples Report www.e-valuation.us e-Valuation Multiples: Advantage  Finding information about private transactions is an extremely laborious task which consumes great amount of time. It is worth realizing regularly this type of activity only for a company specialized in company valuation such as e-Valuation. In its daily activity, e-Valuation uses its sources in the following cases:  To obtain valuation multiples in order to use them in a company valuation  To inform itself about recent transactions in a particular sector, (for example in order for mergers and acquisitions´ advisers to prepare a reunion with a potential client, or if a company wants to inform know more about the movement which is happening in the sector)  To inform itself about companies which are currently in acquiring position in the market, as well as the type of acquisition they are interested in.  For this reason, the present report is addressed to the following collectives:  Venture Capital  Advisors and intermediates in fusions and acquisitions  Corporate Finance specialized agency  Investment banks  Companies which wants to know a reference price in their sector 5
    • Strictly Private and Confidential JANUARY 2010 XYZ COMPANY – Valuation Multiples Report www.e-valuation.us e-Valuation Multiples: Contracting  The different contracting modalities are the following ones:  Multiples customized finding request: the client describe the companies´ activity of the multiples he wants to know, and e-Valuation carries out a customized research on the client request. The research terms can be established in regards to: 1. Sector and subsector 2. Business model 3. Geographical areas 4. Companies country 5. Transactions date It is also possible to limit the number of transactions to be included in the report, or to establish research priorities, extending progressively the research range in case of finding few transactions comparables according to initials criteria. 6
    • Strictly Private and Confidential JANUARY 2010 XYZ COMPANY – Valuation Multiples Report www.e-valuation.us e-Valuation Multiples: Price In case of transactions:  Minimum requests for transactions are 5 transactions, equivalent to 250 euros to pay in advance. The payment for more transactions will be done at their delivery at the rate of 50 euros by chosen transactions (included those which would not have multiples). In the case of quoted companies:  Through this service, the client establishes the criteria under which he is interested in the quoted companies and e-Valora would do the consequent filter according to the client´s needs. The minimum is 5 listed companies equivalent to 250 euros to pay in advance. The payment to realize for more companies will be done at their delivery at the rate of 50 euros by chosen company. Payment commitment:  e-Valuation will inform the client about the number of transactions found and the price resulting from the report with the corresponding invoice sending. Payment terms:  The Multiples report will have to be paid in any case before its delivery to the client. Once the payment confirmation is received, the file with the requested information will be send by e-mail. 7
    • Strictly Private and Confidential JANUARY 2010 XYZ COMPANY – Valuation Multiples Report www.e-valuation.us e-Valuation Multiples: Contact Details e-Valuation Financial Services North America e-Valuation Financial Services Northern Europe 14 Wall Street, 20th Floor One Canada Square, 29th Floor, Canary Wharf New York City, New York 10005 London E14 5DY United States of America United Kingdom e-Valuation Financial Services Central and South America e-Valuation Financial Services Southern Europe 111 Brickell Avenue, 11th Floor c/ José Ortega y Gasset, 42 Miami, 33131 Madrid, Madrid 28006 United States of America Spain 8