Value involvement and route of acquisition

Value involvement and route of acquisition

In cross border M&A the both banking and non-banking individuals are involved in the front end stages of the negotiation. Financial valuation and negotiation are considered to be their prime job along screening and job contact.

In cross border deals, market valuation based on price earning ratio is the most widespread method used for valuation. This method is popular because of its familiarity and simplicity.
The next popular method is the Discounted Cash Flow method. Any adjustment made for risks and other factors in this method is done in an ad hoc manner.

The other popular methods of valuation are

• Comparable Deals
• LBO value
• Control Premium

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