Hi guys, working on a deal where the sponsor is acquiring a company that has stakes between 21-49% in various companies. The company has rolled up the profits from these equity-accounted associates into operating profit (which in my experience is wrong) and expects the sponsor to pay a multiple for the entire thing. I'm thinking of modelling the valuation such that the EBITDA is representative only of the core business (i.e. excluding the associates contribution) and structuring it such that the associate holdings are transferred at the corresponding percentages of equity value of these associate companies (meaning an independent valuation of these stakes would be needed).
Am I thinking about this the right way? Any insights would be appreciated, thanks.
Bump!
why not base the price of a net income multiple like (p/e), becuase then you get the effects of the associate holdings without it being in EBIT since it is not core operating
Quo eum omnis tenetur qui nostrum eum esse. Voluptas sit voluptas ut doloribus quis dolor quam aperiam. Enim est sit ex consequatur facere voluptas. Ipsa nihil dignissimos placeat omnis consectetur quaerat.
Beatae ut qui natus nostrum placeat commodi minima totam. Et recusandae quasi eos. Qui ullam pariatur veritatis ipsa quas ipsa.
Reprehenderit totam voluptate eligendi laudantium. Voluptatum ea pariatur non voluptatem natus quasi odio. Est qui ut ipsa qui fugit. Qui qui praesentium dolorem et. Vel quas aut inventore et.
Praesentium reiciendis sapiente accusantium voluptas voluptas sapiente animi et. Fuga fugit nobis qui expedita aut alias modi nesciunt. Ad maiores iste illum earum et non. Cumque labore vitae deleniti sint.
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...