Corporate valuation & succession

Choose the most appropriate seminar for you:

	Seminar	Your benefit	Duration	Details	Registration
	Company sales & Business succession planning Discreet succession planning & Optimal pricing	Corporate valuation optimization – Transfer models – Successors data base	1 Day

	Seminar	Your benefit	Duration	Details	Registration
	Company value – Achieving success in succession Organize company sales successfully	Master key components of company value	1 Day

	Seminar	Your benefit	Duration	Details	Registration
	Succession planning – Developing leaders Optimal succession organization – Find the best prices	Everything about company succession	2 Days

	Seminar	Your benefit	Duration	Details	Registration
	Conflict management – Family business succession Conflict-free management and succession in family business and ownership transfer	Succession – Communication – Conflict solutions	1 Day

German medium-sized business is undergoing a change

Around one-fourth of medium-sized companies will transfer ownership in the next five years. Over a half of medium-sized businesses will encounter a company succession in the following ten years. A high number of company transfers is currently pertained due to demographic changes. Above ninety percent company succession will seek a successor since its holders enter their retirement age.

As a first step of a company transfer, the outgoing entrepreneurs should establish the value of their company.

When this problem is solved, a considerable selection of suitable successors becomes the issue of the greatest importance.

Corporate valuation

It is very helpful to establish the value of your company in order to be better familiar with your company situation. For this purpose, numerous assessment procedures are available (value of potential earnings, net asset value, DCF, multipliers, etc.). In addition to financial key figures (EBIT, EBIDTA, income, etc.), human, structural and relational capital can be included in the corporate Know-How valuation. Knowledge about different methods of corporate valuation (net asset value method, liquidation value method, earning-capacity value method, etc.) help banks, potential purchasers, successors and investors to manage competently and confidently. A lot of entrepreneurs enter negotiations having very high price-expectations. A fair evaluation is further crucial to successful sales results. A realistic value of the company is also important in order to estimate capital requirements properly.

Succession

Many medium-sized companies are characterized through the reputation of the entrepreneurs. The successor has to first earn the trust of employees, suppliers and customers. Therefore, in order to become successful, the successor should fulfill personal, entrepreneurial and profession-oriented requirements. The selection of potential successors is often limited, and due to the shortage of time, it is difficult to check whether all criteria are fulfilled. For this reason, the search for a suitable candidate represents a major challenge for many entrepreneurs.

Only in Germany, there are 71.000 companies this year which are looking for successors. How is it possible to find the best one? You do not want to entrust the company to anyone, especially if you invested your time, efforts and strength in that company. You want to have the best successor. Somebody who is able to identify himself with the company and its strategic objectives. Not somebody who will be intended to pull the money out of your company and bring it to its decline.

There are various alternatives for family-internal succession. In most cases, the company is passed over to the next generation by anticipated inheritance such as making a gift. The successor receives the company in this case free of charge. In some cases, it may be advisable or necessary to demand payment for the company in return. The issues of pension scheme is important in this respect.

When managers buy “your company”, and will finance it entirely with their own capital, it will be referred to as Management- Buy-Out (MBO). In case your company moves to external chief executives, it is considered as Management-Buy-In (MBI). If the purchase is predominantly financed by outside capital, it will be labeled as a Leveraged-Buy-Out (LBO).

Change of holders does not proceed without conflicts. The transfer process should be well-planned and the transition phase should not last too long. Competency overlaps within companies and among business associations often lead to uncertainties and confusion. Psychology and communication are two most important rubbing points in every succession procedure. A well-prepared communication process between family, successor and employees is the key to success. Conflict-free management forms the basis for a successful and long-lasting management in family businesses.