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Understanding Valuation Techniques in Mergers and Acquisitions

Sun Acquisitions

This approach involves analyzing the fair market value of the target company’s assets and liabilities. In the context of M&A, asset-based valuation techniques such as book value and liquidation value are commonly employed.

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Top Methods CPAs Use to Determine a Business’ Value

Shuster & Co.

In this instance, the formula accounts for the business’ total equity by calculating asset value minus total liabilities. The liquidation value method assumes that the business will cease operations and liquidate any assets. The value is based on the net cash that would be generated from the sale of assets.