Tag: Consult
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How do we value companies in highly technical industries?(E.g. Solar, power plants, mining, etc.)
At ORNA, we specialise in financial modelling and valuation.For industries that require engineering or technical expertise, we rely on industry-specific reports provided by our clients to ensure our assumptions align with actual operational conditions. Examples include: These reports form the technical foundation of our financial forecasts.From there, we translate the information into revenue projections, cost…
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Before investing, know what you’re really buying. : A real case we handled recently
Mr. A was considering investing in Company B.He knows the industry well — high margin, not easy for new players to enter — so becoming a shareholder felt like a good first step into the business. He reached out to us for a valuation. During our review, we interviewed Company B’s management together with Mr.…
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Sharing Info With a Potential Competitor in M&A — Should You Be Worried?
Our client is planning to sell xx% of its shares to a new strategic investor. One potential buyer showed strong interest. During the NDA stage (Non Disclosure Agreement where each party sign an agreement to not disclose any confidential information of each other) it was discovered that this same company had already acquired over 50%…
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During a recent M&A negotiation, a client came across the term “Earnout Payments.”
In simple terms, an earnout is when a buyer pays part of the purchase price upfront (XXX) — and agrees to pay an additional amount (YYY) later only if the acquired company meets certain performance targets.These targets are often tied to EBITDA, revenue, or gross profit or Non-financial milestones — e.g. achieving a regulatory approval,…
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What is a “Terminal Value”?
If you’ve ever read a business valuation report and saw the term Terminal Value, it simply means this: When we value a company, we normally forecast around 5 years into the future.But companies don’t stop operating after year 5. So instead of forecasting forever, we estimate the value of the business after the forecast period,…
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Thinking of buying or selling a business?
Here’s the simple version of how an M&A deal actually works. A lot of people think it’s just “meet → agree price → sign the contract.”But in reality, there’s a proper flow — 1️⃣ NDABefore sharing any sensitive info, both sides sign an NDA.Meaning: “You’ll see my secrets. Please don’t share them.” 2️⃣ MOU /…
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It’s beginning to look a lot like Christmas 🎄Peak season is coming… and for many businesses, sales are about to shoot up.
This is why, when we do a business valuation, we always ask for year-to-date performance (internal numbers are perfectly fine) and at least 3 years of historical data. Because not every business behaves the same throughout the year. Some are seasonal — Christmas, Chinese New Year, school terms, tourism periods, you name it. Some have…
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Should we include future benefits from an investor’s network when valuing a company?
A while ago, Company A hired us to value Company B before making an investment.After the deal, Company A expects to bring new business deals to Company B through their own connections. Both companies asked the same question: “Should these benefits be included in the valuation of Company B?” Our answer was simple — No.…
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💡 Why AR Days, AP Days, and Inventory Days Matter in Business Valuation
When we do business valuation, we don’t just look at the usual numbers like revenue, profit, or investment.Another important factor to consider is the cash conversion cycle (CCC). In short, CCC tells us: This cycle determines how efficiently the company turns operations into cash — and ultimately, how healthy its liquidity is. So it’s not…
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Can I get a business valuation from ChatGPT (or any AI tool)?
The answer is… yes and no. Yes — you can insert your company’s financial statements and ask AI to calculate a valuation. You’ll probably even get a clean-looking number, maybe with a DCF model attached. But the thing is — unless you know what to input, the result won’t be realistic. AI will happily crunch…
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