并购整合估价(1).ppt

Valuation ValuationasaTool Weencountervaluationinmanysituations Mergers AcquisitionsLeveragedBuy outs LBOs MBOs Sell offs spin offs divestituresInvestorsbuyingaminorityinterestincompanyInitialpublicofferingsHowdoweestablishvalueofassets Objectivetoday Topreviewvaluationmethodsusedmostcommonlyinpractice BusinessValuationTechniques Discountedcashflow DCF approachesDividenddiscountmodelFreecashflowstoequitymodel directapproach Freecashflowstothefirmmodel indirectapproach RelativevaluationapproachesP E capitalizationofearnings EnterpriseValue EBITDAOther P CF P B P SControltransactionbasedmodels e g valuebasedonacquisitionpremiaof similar transactions DiscountedCashFlowValuation Whatcashflowtodiscount Investorsinstockreceivedividends orperiodiccashdistributionsfromthefirm andcapitalgainsonre saleofstockinfutureIfinvestorbuysandholdsstockforever alltheyreceivearedividendsIndividenddiscountmodel DDM analystsforecastfuturedividendsforacompanyanddiscountattherequiredequityreturnProblemwithdividends theyare managed Dividends TheStabilityFactor Factorsthatinfluencedividends DesireforstabilityFutureinvestmentneedsTaxfactorsSignalingprerogatives Dividendchanges PubliclytradedU S Firms Source A Damodaran InvestmentValuation Wiley 1997 Valuation BacktoFirstPrinciples Valueofthefirm valueoffixedclaims debt valueofequityHowdomanagersaddtoequityvalue Bytakingonprojectswithpositivenetpresentvalue NPV Equityvalue equitycapitalprovided NPVoffutureprojectsNote Markettobookratio or Tobin sQ ratio 1ifmarketexpectsfirmtotakeonpositiveNPVprojects i e firmhassignificant growthopportunities Valuation FirstPrinciples Totalvalueofthefirm debtcapitalprovided equitycapitalprovided NPVofallfutureprojectsprojectforthefirm uninvestedcapital presentvalueofcashflowsfromallfutureprojectsforthefirmNote Thisrecognizesthatnotallcapitalmaybecurrentlyusedtoinvestinprojects TheValuationProcess IdentifycashflowsavailabletoallstakeholdersComputepresentvalueofcashflowsDiscountthecashflowsatthefirm sweightedaveragecostofcapital WACC Thepresentvalueoffuturecashflowsisreferredtoas Valueofthefirm sinvestedcapital orValueof operatingassets or TotalEnterpriseValue TEV TheValuationProcess continued Valueofallthefirm sassets orvalueof thefirm Vfirm TEV thevalueofuninvestedcapitalUninvestedcapitalincludes assetsnotrequired redundantassets excess cash notneededforday to dayoperations Valueofthefirm sequity Vequity Vfirm VdebtwhereVdebtisvalueoffixedobligations primarilydebt TotalEnterpriseValue TEV Formostfirms themostsignificantitemofuninvestedcapitaliscashVfirm Vequity Vdebt TEV cashTEV Vequity Vdebt cashTEV Vequity NetdebtwhereNetdebtisdebt cash note thisassumesallcashis excess MeasuringCashFlows FreeCashFlowtotheFirm FCFF representscashflowstowhichallstakeholdersmakeclaimFCFF EBIT 1 taxrate Depreciationandamortization noncashitems CapitalExpenditures IncreaseinWorkingCapitalWhatisworkingcapital Non cashcurrentassets non interestbearingcurrentliabilities e g A P accruedliab WorkingCapitalvs PermanentFinancing Short termassets Short termliabilities PermanentCapital Long termassets PermanentCapital Operatingassets Workingcapital Permanentcapitalmayinclude current itemssuchasbankloansifdebtislikelytoremainonthebooksKey Treatitemsaseitherworkingcapitalpermanentcapitalbutnotboth Uninvestedcapital FCFFvs AccountingCashFlows IncomeStatement Hudson sBay millions FYEJan1999 Sales 7 075CostofGoodsSold 6 719EBITDA 356Depreciation 169EBIT 187InterestExpense 97IncomeTaxes 50NetIncome 40Dividends 53 CashFlowStatement Hudson sBay millions FYEJan1999 CashflowfromoperationsNetIncome 40Non cashexpenses 169ChangesinWC 116 Cashprovided used byinvestmentsAdditionstoP P E 719 Cashprovided used byfinancingAdditions reductions todebt 259Additions reductions toequity 356Dividends 53 OverallNetCashFlows 64 Hudson sBayFCFF 187 1 0 44 169 719 116 561 CashFlowDefinitionIssues HowisFCFFdifferentthanaccountingcashflows OperatingcashflowsincludesinterestpaidWewanttoidentifycashflowsbeforetheyareallocatedtoclaimholdersFCFFalsoappearstomisstaxsavingsduetodebtKey thesetaxsavingsareaccountedforinWACC AnExample 1millioncapitalrequiredtostartfirmCapitalstructure 20 debt 10 pre taxrequiredreturn 10 preferreddebt 7 requiredreturn 70 equity 15 requiredreturn taxrateis50 firmexpectstogenerate244 000EBITinperpetuityfuturecapitalexpendituresjustoffsetdepreciationnofutureadditionalworkingcapitalinvestmentsarerequiredWhatshouldbethevalueofthisfirm AnExample continued AftertaxWACCis12 2 sopre taxWACCis24 4 EBIT capitalisalso24 4 soNPVoffutureprojectsforthisfirmiszeroValueoffirmshouldequal 1million investedcapital FCFF EBIT 1 t 122 000Value 122 000 0 122 1 000 000 TwoStageFCFFValuation ImpossibletoforecastcashflowindefinitelyintothefuturewithaccuracyTypicalsolution breakfutureinto stages Stage1 firmexperienceshighgrowthSourcesofextraordinarygrowth productsegmentationlowcostproducerPeriodofextraordinarygrowth basedoncompetitiveanalysis industryanalysisStage2 firmexperiencesstablegrowth Stage1Valuation ForecastannualFCFFasfarasfirmexpectstoexperienceextraordinarygrowthgenerallysalesdrivenforecastsbasedonhistoricalgrowthratesoranalystforecastsEBIT capitalexpenditures workingcapitalgivenasapercentageofsalesDiscountFCFFatthefirm sWACC kc FCFF1 FCFF2 FCFFt 1 kc 1 kc 2 1 kc t VALUE1 Stage2Valuation StartwithlastFCFFinStage1AssumethatcashflowwillgrowatconstantrateinperpetuityInitialFCFFofStage2mayneedadjustmentiflastcashflowofStage1is unusual spikeinsalesorotheritemscapitalexpendituresshouldbeclosetodepreciationValue1yearbeforeStage2begins FCFFt 1 g Kc g Stage2Valuation PresentvalueofStage2cashflows TerminalValueorTV Keyissueinimplementation Terminalgrowth g rateof stable growthintheeconomy realrateofreturn 1 2 plusinflation TEV VALUEt TV 1 1 kc t x TV FCFFt 1 g Kc g DiscountedFCFFExample AssumptionsYearEBITDepCapExW CChange140462250573360684Taxrate 40 kc 10 Vdebt valueofdebt 100Growth g ofFCFFsbeyondyear3 3 DiscountedFCFFExample cont d FCFF EBIT 1 t Dep CapEx IncreaseinWCYear1FCFF 40 1 0 4 4 6 2 20Year2FCFF 50 1 0 4 5 7 3 25Year3FCFF 60 1 0 4 6 8 4 30 DiscountedFCFFExample cont d 20253030 1 g 30 1 g 2 t 012345P Vfirm30 1 g kc g TEV 20 1 kc 25 1 kc 2 30 1 kc 3 30 1 g kc g 1 kc 3 DiscountedFCFFExample cont d TEV 20 1 10 25 1 10 2 30 1 10 3 30 1 03 0 10 0 03 1 10 3 18 2 20 7 22 5 331 7 393 0TEV Cash Vfirm Vfirm TEV 393 0Vfirm Vdebt Vequity Vequity Vfirm VdebtVequity 393 0 100 0 293 0 RelativeValuationApproaches CapitalizationofEarnings Computetheratioofstockpricetoforecastedearningsfor comparable firmsdetermineanappropriate P Emultiple IfEPS1istheexpectedearningsforfirmwearevaluing thenthepriceofthefirm P shouldbesuchthat P EPS1 P Emultiple Rearranging P P Emultiple xEPS1 P ERatiosandtheDDM RecalltheconstantgrowthDDMmodel butapplyittoafirmwith100 payoutratio P Eratioscapturetheinherentgrowthprospectsofthefirmandtherisksembeddedindiscountrate P EMotto GrowthisGood RiskisRotten P D1ke g P EPS1ke g P 1EPS1ke g P ERatioBasedValuation Fundamentally the P Emultiple relatestogrowthandriskofunderlyingcashflowsforfirmKey identificationof comparable firmssimilarindustry growthprospects risk leverageindustryaverage TEV EBITDAApproach TEV MVequity MVdebt cashEBITDA earningsbeforetaxes interest depreciation amortizationComputetheratioofTEVtoforecastedEBITDAfor comparable firmsdetermineanappropriate TEV EBITDAmultiple IfEBITDA1istheexpectedearningsforfirmwearevaluing thentheTEVforthefirmshouldbesuchthat TEV EBITDA1 EV EBITDAmultiple TEV EBITDAApproach Rearranging TEV EV EBITDAmultiple xEBITDA1Nextsolveforequityvalueusing MVequity TEV MVdebt cashMultiplesagaindeterminedfrom comparable firmssimilarissuesasintheapplicationofP Emultiplesleveragelessimportantconcern OtherMultipleBasedApproaches Othermultiples PricetoCashFlow P P CFmultiple XCF1PricetoRevenue P P Revmultiple XREV1Multipleagaindeterminedfrom comparable firmsWhywouldyouconsiderpricetorevenueover forexample pricetoearnings MergerMethods Comparabletransactions Identifyrecenttransactionsthatare similar Ratio basedvaluationLookatratiostopricepaidintransactiontovarioustargetfinancials earnings EBITDA sales etc RatioshouldbesimilarinthistransactionPremiumpaidanalysisLookatpremiumsinrecentmergertransactions pricepaidtorecentstockprice Premiumshouldbesimilarinthistransaction ValuationCaseProcess Size upthefirmbeingvalueddoprojectionsseemrealistic lookatpastgrowthrates pastratiostosales etc whatarethekeyrisks Valuationanalysisseveralapproaches sensitivities tiedtorisks Addresscasespecificissuese g forM A whatisfit size upbidder anysynergies biddingstrategy structuringthetransaction etc e g forcapitalraising timing dealstructure etc TheValuation Myths Likeallanalyticaldisciplines valuationhasdevelopeditsownsetofmythsovertime Myth1 Valuationmodelsarequantitative soitisobjectiveandprecise Myth2 Awell researche