UK200Group launches valuation index for SMEs
26 Nov 09
The UK200Group, which represents 110 firms including mid-tier accountancy practices, has put together its own company valuation index to measure the value of small and medium sized businesses
Details of completed transactions are provided by the corporate finance panel's independent SME specialists working within UK200Group member firms of accountants and lawyers throughout the UK to facilitate comparisons not available from published data.
“What the UK200Group's SME valuation index provides,” says Simon Blake, corporate finance partner at Price Bailey and chairman of the group’s corporate finance panel, “is a database that gives us the real, adjusted, average price/earnings multiple applicable to the sale of businesses in the SME sector, based on actual deals the group’s corporate finance specialists have advised on.”
“In particular, this has enabled us to eliminate distracting elements from the data by removing surplus asset payments from consideration and comparing only adjusted profits, allowing for commercial directors remuneration. We believe this makes our index unique and much more relevant for use in valuing businesses, whether for sale/acquisition, for court purposes or for agreeing valuations with HMRC.”
The index includes deals valued up to £20m comprised 60 per cent trade sales and acquisitions and 40 per cent MBOs, BIMBOs and MBIs.