Business Valuation – Case Study 1.4

Company profile:
Our client company is a provider of leading best-of-breed managed network solutions by leveraging its relationships with over 100 global network providers to offer the best solution for corporate network requirements. Hundreds of Fortune 1000 companies rely on our client to deliver distinctive, cutting-edge network solutions. Delivering ubiquitous access to cloud-based voice, video, security and computing applications, their customizable, cost-effective and scalable solutions are delivered on their own fully redundant global network infrastructure with interconnection to over 200 best of breed global suppliers.

The Challenge / Business situation:
The purpose of our engagement was to provide a summary report valuation opinion to determine the Fair Market Value of our client company’s equity for tax reporting.

ValuLink Approach and Solution:
We worked closely with management to understand the scope and goals of the valuation. We performed an in-depth analysis of the economy, industry and the competitive landscape to support our valuation work. This was essential to understand the earning potential and risk associated with the business. With respect to the valuation of the Company’s shareholder’s equity, we relied on two approaches: Income and Market. We utilized a discounted cash flow “DCF” method in order to best reflect the value of the Company’s shareholder’s equity based on the financial projections prepared by the Management of the Company. This analysis included all other factors affecting the cash flow, including depreciation and amortization and income taxes. The guideline public company method required selection of public companies similar to the target company’s business. Once selected, we calculated selected financials including EBIT, EBITDA, Market Capitalization and MVIC from the financial statements of the companies.

The Result:
Based on our opinion and financial valuation, we arrived at the conclusion of the Fair Market Value of our client company’s equity. ValuLink’s expertise in the telecommunication industry helped our client to analyze their phenomenal growth and bridge the gap with traditional industry values.

*The above case study is for informational purposes only and should not be used for any other purpose.