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Valuations

Why value your business with Sunbelt Central America?

At Sunbelt Central America we use a structured and proven process to determine the Most Probable Selling Price (MPSP) range for your business.

We are characterized by:

  • Use of different valuation methodologies
  • Sensitization of various scenarios for the most probable sale price
  • Reference and statistical analysis with internationally comparable transactions
  • Analysis of the company from a qualitative point of view
  • See the business from the perspective of a potential buyer
  • International support, with access to a network of international appraisers 
  • Educational and participatory process for the client 

 

Valuation

Methodologies

Income Approach

Based on the Principle of Future Benefits. The value of a business is determined by the sum of the present value of future income, discounted at a rate that reflects the weighted cost of capital. The most used method in this approach for the valuation of companies is the Discounted Cash Flow (DCF) method.

The fundamental elements for the Discounted Cash Flow method:

  • Projection of expected income in the future
  • Weighted Cost of Capital (WACC) or Discount Rate
  • Terminal Value:
    • Perpetuity
    • Exit Multiple

Market Approach

Based on the Substitution Principle. The value of the target company depends on how the market values ​​similar companies from an operational and financial point of view.

The two fundamental elements for the market approach are:

  • Market multiples of comparable business purchase-sale transactions
  • Operating performance indicators (Sales, EBITDA, Net Profit, etc.)

Cost Approach

This approach is based on the book value of assets and / or commercial value, as well as the equity value of a business. The concept behind this approach is that the value of the business depends on how much it costs the buyer to build the business from scratch.

Our valuation

process

Initial meeting
with the client
  • Agree the basis for the valuation
  • Financial information request:
    • Financial statements of at least 3 years
    • Historical monthly sales
    • Cost structure, etc.
 
Company
analysis
  • Analysis of financial information and trends
  • Recasting (normalization) of financial statements
  • Financial analysis of the company compared to other companies in the industry
  • Qualitative analysis of the company
Generation and analysis
of projections
  • Reception and validation of income projections
  • Industry and market research
  • Expense projections and validation with the company administration
Determination of
variables to be sensitized
  • Research of comparable transactions
  • Determination of EBITDA multiples
    • Fit by size
    • Country risk adjustment
  • Determination of discount rates (WACC)
    • Build up Method
    • Method CAPM
 
MPSP scenario
generation
  • Use of different valuation methodologies
  • Feeding our financial model:
    • Historic information
    • Projections
    • Discount rates
    • EBITDA multiples
Determination of the
MPSP range
  • Statistical analysis of sensitizations
  • Analysis of IRR (Internal Rate of Return) from the perspective of a potential buyer
Final Presentation
to the client
  • Final presentation to the client
  • Delivery of Final Assessment Report
 

COSTS

The valuation has a cost equal to a single payment that will depend on the size and complexity of the company.

Would you like a proposal for our valuation services? Contact Us.

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Contact us

SUNBELT CENTRAL AMERICA

10th avenue 35-01 Zone 16,

Building B Office 301, Guatemala C.A.

Phone: +502 2428 7800

sunbeltcentam@sunbeltnetwork.com

Sunbelt Central America is the leading firm in business buying and selling, company valuation, and mergers and acquisitions (M&A) advisory in Guatemala, El Salvador, Costa Rica, Panamá, Colombia, Honduras, and the Dominican Republic. Our team of M&A experts and strategic consultants works to maximize your company’s value and ensure successful transactions in key markets across the region

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