Valuation for Mergers and Acquisitions - Hardcover

Master the latest insights, lessons, and best practice techniques for accurately valuing companies for potential mergers, acquisitions, and restructurings. Concise, realistic, and easy to use, Valuation for Mergers and Acquisitions, Second Edition has been fully updated to reflect the field's latest and most useful "rules of thumb," compare every modern approach to valuation, offering practical solutions for today's most complex and important valuation challenges. Treating valuation as both an art and a science, it covers the entire process, offering up-to-the-minute real-world advice, examples, and case studies. Leading valuation experts Barbara S. Petitt and Kenneth R. Ferris introduce and compare leading techniques including discounted cash flow analysis, earnings multiples analysis, adjusted present value analysis, economic value analysis, and real option analysis. They fully address related concerns such as the accounting structure of deals, accounting for goodwill, tax considerations, and more. Throughout, they identify common errors that lead to inaccurate valuation, and show how to avoid them. From start to finish, this guide doesn't just make valuation comprehensible: it provides the tools and insight to make valuation work. For all financial professionals concerned with valuation, especially those involved in potential mergers, acquisitions, and restructurings; and for corporate finance instructors and students in Executive MBA programs concerned with valuation.

Master Today’s Best Practices for Valuing Companies

“Petitt and Ferris show us the data required for valuing a company, what computations to perform, and the advantages and drawbacks of each technique. This very practical book is an outstanding guide for company executives, financial managers, valuation practitioners, and investment professionals.”
—Professor Elroy Dimson, London Business School and Cambridge Judge Business School

“Valuation is a key factor for success in any M&A transaction. This book contains a comprehensive set of tools and a conceptual framework for tackling practical challenges of valuations. It is richly illustrated by concrete examples of best practices and pitfalls to avoid.”
—Yves Courtois, CFA, CMT, Corporate Finance Partner at KPMG, Co-Head of KPMG’s Global Valuation Institute

Valuation is the essence of finance. But it is an art, not a science: Corporate executives and valuation analysts face many choices and dilemmas when assessing a company’s value. This concise guide offers an up-to-date, practitioner-oriented view of valuation in the context of mergers and acquisitions (M&A) and corporate restructurings. It has been extensively revised to present today’s most widely used valuation methods, and to offer realistic solutions for making informed choices and dealing with common dilemmas.

Leading experts Barbara S. Petitt and Kenneth R. Ferris cover the entire valuation process, presenting practical advice and real-world examples and illustrations. They review and compare frequently used valuation methods, including discounted cash flow models, earnings multiples, economic value analysis, and real option analysis.

Petitt and Ferris address issues that are closely related to valuation, such as accounting, financial reporting, and tax considerations. They also identify common valuation errors and show how to avoid them. Whether you are an executive or an analyst, this guide will help you play a far more effective role in valuation for M&As or corporate restructurings.

· Understanding the challenges of valuation
Why valuation errors cause so many acquirers to overpay
· Understanding valuation methods and tradeoffs
When and how to use multiples, discounted cash flow models, or real option analysis
· Performing financial review and pro forma analysis
How to analyze a company’s performance and forecast its future earnings and cash flows
· Avoiding overconfidence and the “winner’s curse”
How to uncover assumptions that could wreck your forecasts and valuation