Business valuation mandate in the context of a family takeover

Mandate description

This mandate aimed to determine the fair economic value of the company before its takeover, based on a thorough accounting and financial analysis.

The mission took place in a context of family succession, where the emotional dimension was central.

The objective was to reconcile the rigor of professional methods — in accordance with international and Swiss standards — with the sensitivity specific to a transition based on trust, continuity and the sustainability of family assets.

The analysis focused on historical financial statements, recurring earnings capacity and long-term operational prospects, while integrating the specificities of a sector with high capital intensity and multi-year contracts.

Key issues

The main challenges consisted of:

• guarantee an independent and technically robust evaluation in a strong emotional context;
• establish an equitable value that preserves family cohesion;
• distinguish asset value from real operational performance;
• reconcile the financial logic of the transaction with the social and human considerations of the purchaser and the transferor.
  

Approach and results

The valuation involved several complementary approaches, in accordance with practices recognized by business valuation professionals:

• the discounted cash flow method (DCF), based on the projection of operating cash flows adjusted for working capital requirements;
• The market multiple method, based on a sample of comparable transactions in the sanitation sector in Switzerland and in neighbouring countries;
• The practitioner method, combining the return value and the asset value derived from the restated financial statements.
  

The conclusions made it possible to establish a coherent value range, reconciling rigorous financial analysis and the human considerations specific to family transmission.

This mission also contributed to objectifying the dialogue between the parties, by establishing a calming numerical and methodological framework in a context where affect and reason were closely intertwined.