Know-how (savoir-faire) is the body of technical and operational knowledge, expertise and processes accumulated by a company that creates competitive advantage — manufacturing processes, formulations, algorithms, operating methods, engineering techniques. As an intangible asset, it is separately recognised in a PPA when it meets the contractual-legal or separability criteria of IFRS 3. Its valuation typically uses the relief from royalty method or the cost approach (replacement cost of the knowledge base). In M&A, know-how is often a primary acquisition driver — particularly in technology, pharmaceuticals and specialty manufacturing.

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Exemple : in the acquisition of a Swiss precision engineering company for CHF 35.0 million, the PPA identifies CHF 5.2 million of production know-how (proprietary machining processes reducing cycle times by 40% versus industry standard), valued using the relief from royalty method at a 4.5% royalty rate on projected revenues discounted over an 8-year useful life at a risk-adjusted rate of 11.0%. This know-how is separately recognised under IFRS 3, reducing residual goodwill accordingly.

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Hectelion values know-how intangibles using IVSC-compliant methods for PPA, fiscal and litigation purposes — see our dedicated publication on know-how valuation.