Valuer is an independent firm with accredited experience providing objectivity and transparency in the valuation of companies or business units based on both national and international valuation standards.
The most common purposes for the valuation of companies include M&A operations, financing, corporate conflicts, or tax reasons. However, the valuation of companies can also be a necessary instrument for business analysis and a support for strategic decision-making.
Independent expert in corporate operations
Valuer acts as an independent expert appointed by the Mercantile Register in Spain for corporate operations.
Fairness opinions are considered a fundamental instrument both in decision-making and in hedging risks for the Boards of Directors in their fiduciary obligations to shareholders and stakeholders.
A fairness opinion concerns the financial terms of corporate and M&A transactions , usually related to the valuation of shares .
A solvency opinion is a document whereby the future solvency of a company is analysed under the hypothesis of having performed certain corporate operations , such as dividend payments, spin-offs, recapitalizations, bankruptcy or restructuring , evaluating the protection of the rights of the shareholders and creditors , once the operation has been done .
In order to issue a solvency opinion the following should be analysed: whether assets will continue to exceed liabilities (balance sheet test); whether cash flows will allow the debt to be paid (cash flow test); and if the post-operation capital will continue to be adequate (capital adequacy test).
Valuation of investment projects
The valuation and analysis of investment projects is an essential tool for decision-making.
The valuation of investment projects requires exhaustive studies of all the critical factors that may affect its operational or economic viability, choosing the option with the highest profitability or the one that best suits strategic interests.
Net present Value (NPV)
The NPV is the sum of the updated values of the investments and expected cash flows of a project, using a discount rate according to the risk of the project. A project is only economically viable when its NPV is positive.
Payback and discounted payback
The payback period is the time required to recover the initial investment in a project, that is, the moment when the accumulated cash flow goes from being negative to being positive.
Homogenization of projects
Break-even point analysis
Valuation in uncertainty scenarios:
Net present value adjusted to risk
Monte Carlo simulations
Valuation by the real options method
Internal rate of return (IRR)
The IRR is the discount rate that makes the NPV of a project equal to zero. The IRR is a measure of relative gross profitability. When the profitability obtained is higher than the cost of capital the projects are considered viable. Regarding to prioritization, projects with a higher IRR are preferable.
The peak funding is when the negative accumulated cash flow of a project is expected to be at its highest absolute value. Peak funding is a complementary metric that is increasingly gaining acceptance due to its ability to predict funding needs.