I'm looking at a company with 2 unrelated business units: one in healthcare and the other in industrials.
The healthcare unit does 200 in EBITDA while the industrial does 270.
Overall, the company has an EV of 10,000.
How would you go about assessing the respective multiple of each business unit?
| +135 | If Tik Tok is forced to sell, what banks do you think would be involved in the deal? | 60 | 4h | |
| +49 | Intern Ettiquette | 14 | 18h | |
| +47 | Ranking banks that went under | 34 | 17h | |
| +42 | Relevance of A-Levels for U.K. London recruiting | 31 | 1h | |
| +39 | Burnt Out M&A ASO | 22 | 1d | |
| +33 | NEED NY RESTAURANT RECOMMENDATIONS | 23 | 15m | |
| +27 | 2024 new grads who didnt get return offers update | 12 | 1d | |
| +23 | PSA to gymcels: focus on the summer internship | 9 | 1d | |
| +22 | Would comitting to ATL İB be stupid? Please give feedback. | 14 | 56s | |
| +21 | IB Career Guideline | 12 | 6h |
Career Resources
Get instant access to lessons taught by experienced private equity pros and bulge bracket investment bankers including financial statement modeling, DCF, M&A, LBO, Comps and Excel Modeling.
Just go about it as if your valuing two different companies. Sum of the parts and you'll applying whatever the relevant standards are for each business line's respective industry. This depends on if you were to be provided only consolidated financials though, so if you're not then you're shit out of luck. Worst case scenario you can figure out a way to weight whatever the relevant attributable metrics are to each business line and factor this into your final multiple calculations.
In the latter scenario though your basically just going to be trying to color with numbers, so figuring whatever your gut tells you then trying to find justification in the numbers. (I know shady but depending on other circumstances this might be your best option.)
Considering you gave EBITDA for both business lines I'm assuming you have access to financials for both respective business lines, so most likely your lucky and should be able to just do a SOTP with whatever valuation methodology is appropriate for each business line. Hope this helps. PM me for more info if you want.
Much appreciated, that all makes sense!
Nostrum distinctio cum voluptatem ipsum atque quidem. Aperiam explicabo autem et nostrum repellat. Sit rerum id reprehenderit voluptatem consectetur. Enim doloremque est consequatur eligendi. Aut sunt consequatur et et. Aliquam nisi deleniti id iure tempora. Provident deserunt eaque atque dolores.
Aperiam facere quod veritatis voluptas aliquam quo cum. Rerum veniam fugit minus nostrum odio consequatur. Eligendi maiores et omnis animi. Commodi veniam cum sed qui quod in. Quas voluptas quasi repellat qui vitae.
Enim eos est animi temporibus. Voluptatem eum deserunt commodi pariatur exercitationem. Quidem sit quod similique. Est aspernatur pariatur odio quae voluptatem odio enim minima. Corporis doloribus autem omnis id optio voluptatem. Reprehenderit in recusandae non eveniet eveniet mollitia est.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...