Business valuation, partial rights in it, and debt securities

Business valuation (determination of value of SSC or MC the entity as a whole as the complex heterogeneous nature of the assets and liabilities that are intended to generate income from economic activities) and private interests, as the valuation of intangible assets, is the most difficult sphere of practical independent assessment, with the pace of development of this sector in recent years are the highest.

First, the practical need for a classic business valuation (both absolute interest in TsMK any company or even entity) arises in such cases:

the preparation for privatization or privatization of state enterprises,
a loan secured securities, the Issuer of which is the business
restructuring, rehabilitation or liquidation of a business entity,
there is need for additional financing entity – issue of bonds, promissory notes,
development and implementation of business plans or investment plans for the development of a business entity,
selling to a business entity of a merger or acquisition,
converting one type of stock to another (for joint-stock companies),
trials to protect the rights of owners or distribution of property among the heirs,
in some places - for insurance purposes.

Generalized algorithm for evaluating business boils down to the following steps:

Task setting the assessment. Occasionally in Ukraine the customer is not very versed in assessment laws and methodology, so if you need our experts at this "preliminary" stage will qualified to formulate the task for assessment and classify a set of rights that will serve as the object of evaluation, so to help the customer most effectively to achieve a specific goal;
A more detailed examination of the object of evaluation and the specifics of the initial data regarding the object of assessment, that is the responsibility of the customer and the necessary amount of the necessary market data from independent sources;
Selection of the necessary and most adequate in relation to the object of evaluation assessment methodology in accordance with the purpose of the assessment and available baseline information;
Perform analysis, calculations and determination of the value of the assessment;
Verification of the obtained results with the required market criteria and additional source of data that can exist at the customer;
Preparation of the evaluation Report and, if necessary, protection to the customer or third parties concerned.

You need to understand that the value of a business as the most methodologically and factually complex area of the independent evaluation, intimately connected with the segments of evaluation, such as:

valuation of intangible assets, in practically all evaluation methods, based on the methodology of the income approach,
the real estate valuation in terms of valuation with commercial potential (trade related property), which are designed to exercise specific and specific commercial activities, for example, gas stations, hotels, cultural and sports purposes and T. I.,
valuation of assets for international audit in terms of checking for impairment of assets in accordance with IAS 36,
valuation of securities as equity and debt, as well as partial rights of owners in other (except joint stock companies) types of business entities and business entities, the legal principles which suggest the presence of more than one owner (e.g. joint-activities).

In other words, the correct evaluation of any of these types of property usually impossible without theoretical knowledge and practical skills and experience in the field of business valuation.

The possibility of applying the securities business activities of enterprises is quite broad, while in Ukraine they usually are used for making payments and as collateral fees, loans.

Basically, the rating of any securities (or partial interests in business entities) is held in the following cases:

the preparation for privatization or privatization of state property by sale of state blocks of shares or stakes in authorized capital of economic societies belonging to the state,
in accordance with the requirements of the law of Ukraine "On joint-stock companies" during the preparation of additional shares or repurchase shares from shareholders in the cases,
in accordance with the requirements of the law of Ukraine "On business associations" – during a change of participants of economic societies in one way or another in the cases,
asset management of joint investment institutions,
buying and selling partial interests in business
trials to protect the rights of owners or distribution of property among the heirs,
obtaining a loan secured by securities.

The procedure of valuation of securities depending on their type, properties, initial data may be embodied in a large number of very diverse methods (discussed with the customer) and almost always contain a complex rather complex analytical studies, based on many years of international experience and can only be done by adequately trained personnel. This work provides, in particular, in-depth retrospective analysis of the current production-economic and financial activities of the company and analysis of its development prospects.

Therefore, only on the basis of the findings, based on serious intelligence, and properly justified, can be significant administrative and legal decisions.

Group of companies "UVECON" evaluates:

entities (SSC, MC) business with the whole set of assets owned and liabilities;
partial interests in business (the share in equity companies, controlling and minority stakes);
bonds, notes and other securities;
assets owned by the entity, and the components of the enterprise as a property complex or its part;
investment projects for reconstruction of existing enterprises (CEC), and the value of planned business start up companies.

Our experts use all possible methods of securities estimation to obtain adequate levels of market, investment or fair value.

The specialists of group of companies "UVECON" and are members of state Examination Commissions at the state property Fund, representatives of the Expert Council of the Ukrainian society of appraisers (collegial bodies who analyze and monitor the quality of the evaluation), the authors of famous textbooks in particular, business valuation and partial interest in the business. Their practical experience is unique in the context of complex situations in business valuation and successful solutions to the many very specific issues that generally have not had to deal in practical terms most of the less advanced domestic peers.

This, no doubt, allows our Clients based on our developments and products to successfully deliver the planned financial and economic operations with minimum calculated risks and achieve their goals.

Head of business valuation and debt securities - Chirkin Andrey.