Intellectual Property Valuation
Intellectual Property Valuation is a subjective, complex and a specialist area. There are many nuances involved in valuing such assets. It is important to note that each Intangible asset/ IP is different and hence a valuation methodology applicable in once case may not be applicable or may be inappropriate in another. Our team has provided intangible asset/ IP valuation services for financial reporting purposes on marque transactions across multiple industries as well as for legal and fund raising purposes.
An intangible asset is a non-monetary asset without physical substance. Goodwill, customer contracts and relationships, software, brandname and IP, such as trademarks, patents, copyrights, and trade secrets are all intangible assets.
Companies require intangible asset or IP valuation for reasons, including fund raising, strategic purposes, litigation, PPA, impairment testing, or for tax compliance.
Our Intangible asset/ Intellectual Property valuation services include:
- PPA
- Impairment testing of goodwill and other intangibles
- Tax related valuations
- Fund raising
- Royalty rate studies
- Useful life assessment
- Discount rate calculations
PPA, Impairment Testing & Financial Investments Valuation
A business combination is a transaction or other event in which a reporting entity (the acquirer) obtains control of one or more businesses (the acquiree). In a business combination, accounting standards require that the acquirer must recognise and measure the fair values of the identifiable assets acquired and the liabilities assumed from the acquiree at the acquisition date and this exercise is referred to as purchase price allocation (PPA).
This involves fair valuation of, aside from the tangible assets, of the intangible assets that meet the required criteria for recognition. An important part of this exercise is to arrive at the goodwill (or the bargain purchase amount) resulting from the acquisition.
Certain PPAs can be complex with purchase consideration including the unquoted/ unlisted shares of the acquirer, earn outs – revenue, profit or other types of guarantees which may require fair valuation of the purchase consideration. This requires knowledge and expertise in scenario and probability analysis as well as complex quantitative analysis and financial modeling coupled with modern high-performance computing. Our team members have deep knowledge and expertise in this area.
The goodwill and infinite life intangible assets must be measured and updated, if needed on an annual basis (or earlier if a trigger event occurs), for impairment testing purposes to assess if the value of the goodwill or an intangible asset has been impaired or reduced in value. Impairment testing is an important step for many companies before the audited financial accounts are finalised. We have been the trusted valuer for numerous local and MNC clients where we have been performing impairment testing for several years.
We also perform valuation of financial investments (assets & instruments) including, loans, redeemable preference shares and equity investments for financial reporting purposes.
Business & Equity Valuation
Business valuation services are both an art and a science. It involves taking into consideration a multitude of factors including the subject company’s management, business strategy, industry, performance of its peers, stage in its life cycle and the sources of its capital. It also involves making subjective adjustments based on the relevant company’s risk and return profile as well as discounts and premiums including, marketability discount, control premium/ minority discount, as relevant.
Business, equity/ share valuations may be required for financial reporting, tax, strategic planning, M&A, fund raising, new and existing shareholders, related party transactions, disputes & litigation and other factors.
These different purposes require taking into consideration, accounting standards, tax requirements, shareholder agreements, industry benchmarks, best practices, etc which require deep knowledge, experience, and the ability to make sound judgements. Our team has been the first-choice valuer for many government agencies, local companies and MNC’s over a long period.
Stock Options & Derivatives Valuation
We value securities or financial instruments issued in connection with acquisitions and fund raising, such as convertible notes/ bonds, warrants, forwards, swaps or with share-based compensation such as employee stock options (ESOPs) or restricted share units (RSUs) that require a valuation for financial reporting, tax, or other purposes.
Our team of experts specialise in quantitative analysis, modeling and valuing of securities or complex financial instruments/ derivatives. We combine financial reporting standards, tax compliance, valuation methodologies, financial modeling with modern high-performance computing to provide solutions to our clients, their auditors, and advisors.
Economic Loss Calculation and Litigation Support
Economic or monetary damages can be an important aspect of commercial litigation proceedings involving breach of contract, employment matters, personal injury or tragedy, intellectual property valuation, and many other disputes and claims.
Our services in this area include:
- Assessment of economic loss and quantification (intellectual property valuation or business/ share valuation) of damages
- Preparation of expert witness report as per the court requirements in the relevant jurisdiction
- Appearance as expert witness to provide economic loss quantification evidence before the court
Property, Plant & Equipment Valuation
Our professionals based in Singapore provide property, plant & equipment (PPE) valuation services across Asia Pacific region covering multiple industries. We estimate depreciation from physical, maintenance records, technological, functional, commercial, and economic factors, to assess the plant & machinery and many other types of fixed assets.
Property or land valuation can be a challenging process particularly when assets involved are unique and in markets where transactions are infrequent. We cover multiple markets from Philippines to Maldives for valuations of hotels, resorts, islands, and various types of infrastructure assets.
In matters including PPA and impairment testing, we provide both intangible assets and valuation of tangible assets. We also provide plant and equipment (P&M) valuation services for bank purposes, M&A, and compliance purposes.
Financial Modeling
Financial modeling involves building logically developed, mathematically accurate representation of financial and business information in a spreadsheet. A financial model is designed to represent the performance and investment or value outcome of a business, share/ investment, project or financial asset. Our team of professionals have vast experience with financial modeling. Examples of the financial models our team develops include:
- 3-way or 3 Statement Model
- Discounted Cash Flow (DCF) Model
- Sum of the Parts Model
- Merger & Acquisition (M&A) Model
- Management Buyout (MBO) Model
- Forecast or Budget Model
- Going Concern Confirmation Model
- Debt Servicing or Liquidity Model
- Option Pricing Model
Capital Raising
We use our expertise to create optimal structures. We supplement our product knowledge with up-to-date market knowledge of structures, pricing and transactions. We maximise value for our clients by way of our relationships with traditional and non-traditional pools of capital underscored by the following investor communities:
- Private Equity Firms
- Venture Capital Firms
- Buyout Funds
- Venture Debt Funds
- Infrastructure Funds
- Sovereign Wealth Funds
- Family Offices
- Hedge Funds
- Private Credit Funds
- Mezzanine Funds
- Special Situation Funds
Debt Restructuring & Resolution
We use our expertise to identify an optimal target capital structure underpinned by a detailed balance sheet and cash flow analysis. We manage the entire transaction negotiation and execution with the lenders and our identified investors. We minimise any shareholder dilution and create durable capital structures with renewed balance sheet strength. Our success lies in maximising shareholder value.
Mergers & Acquisitions (M&A)
We use our expertise to create solutions which are focused on optimising shareholder value. We offer to our valued clientele comprehensive assessment of alternatives, structures, target identification and analysis, as also managing the transaction negotiation and execution.
IPO Advisory
We manage the entire process from scratch to a successful listing aimed at maximising shareholder value. We create a valuation framework as IPO reference and identify suitable jurisdictions for listing. We also help identify and negotiate with the appropriate Merchant Bank/ Lead Manager, Legal Counsel and all other relevant function-specific agents/ consultants.
Other Services
We offer other consulting services which include:
- Industry Studies: We provide tailored industry research for our client’s requirements for various purposes.
- Research: We provide general and bespoke research services for investment decision-making process.
- Commercial Due Diligence: We assist prospective buyer to uncover a target company’s commercial activity including, customers, suppliers, management & staff, capacity, service quality, pricing, viability and potential.
- Business Plans: We provide business plan containing business goals, description in details of products and/or services, industry and target market, marketing and operations plan, management and staff, key risk factors, opportunities, and financial and investment matrix.
- Feasibility studies: We perform feasibility studies for various types of projects for purposes including, strategic reasons, commercial assessment, and funding.
