| JSE Sponsor/Designated Adviser
Merchantec offers valuations that are objective, independent and are backed by our extensive corporate finance experience and strong valuation skills. Our team of specialists perform valuations with the maturity and expert knowledge that comes with solid financial and business experience, as well as the insight gained into a number of local industries and market niches.
Business valuations play a crucial role in determining the relative merits of undertaking a specific transaction by allowing management to analyse the deal on an impartial basis and therefore formulate realistic objectives. An independent and properly conducted valuation will provide management with a platform from which effective business decisions can be made.
There are a number of circumstances when a business valuation is required for business owners. These include:
• BEE/Employee share incentive scheme deals
• Disposals/business reorganisations
• Tax consolidations and other tax considerations
• Support of the carrying values of investments and intangible assets
• Shareholder disputes
• Management buy-outs
Merchantec’s experienced professionals have the necessary skills to assist your business in these areas.
Purchase Price Allocation Valuation (PPAV)
In terms of IFRS* 3 Business Combinations, when an acquisition where control has been obtained has been concluded, a PPAV must be included in a company’s annual financial statements.
The determination of the fair values of all tangible and intangible assets is necessary in order to allocate the purchase price so as to comply with IFRS. The PPAV will allocate value to all identifiable intangible assets. Merchantec has the solid track record and necessary specialised resources required to assist companies in valuing their intangible assets.
According to the general principle set out in IFRS* 2 Share-based Payment, an entity is required to recognise the goods or services received/acquired in a share-based payment transaction as an expense. The charge in the income statement is recognised over the vesting period at fair value as estimated at the grant date of the share options for which vesting conditions have been satisfied.
Merchantec has the necessary skills and expertise to assist companies in determining such fair value at grant date.
Merchantec is an approved independent professional expert with a strong track record in providing impartial and credible independent expert's opinions on the fairness of transactions as required by the JSE Listings Requirements and/or the Securities Regulation Code on Takeovers and Mergers. Our experience allows us to assess all aspects of any transaction in order to determine whether the transaction is fair and reasonable to shareholders, including those with minority interests.
* International Financial Reporting Standards