Business ValueXpress^®

Business ValueXpress^® (BVX^®) is a Corporate Finance tool that provides objective valuation and deal structure analysis in buying and selling of businesses. BVX^® is an interactive, intuitive, and easy-to learn program that performs valuations in seconds.  

BVX^® is designed to help Buyers of businesses, Sellers of businesses, Accountants, Attorneys, Bankers, Business Brokers, Mergers &Acquisition (M&A) Advisors, Financial Advisors, and Business Consultants. BVX^® adds objectivity to business valuation, deal structuring and the M&A transaction process.  

BVX^® determines the maximum business value for the Seller while minimizing the Buyer’s equity. Its proprietary valuation approach is based on the following BVX^® definition for the value of a firm.  

“Value of a firm is the Equilibrium of Price, Terms, and Deal Structure that satisfies the needs of all parties to an M&A transaction.” 

The above approach, called the Equilibrium method of valuation, is a departure from the conventional valuation methods that are generally silent or lack clarity on the terms and deal structure associated with business value. In BVX^®, Price, Terms and Deal Structure are interdependent. BVX^® determines the optimal business value by satisfying the requirements of the five claim holders to the business cash flow. These claim holders are: a) the Seller, b) the Buyer, c) the Business, d) the Lenders, and e) the Tax Authority. 

BVX^® uses proprietary methodology that involves decision-making algorithms and use of optimization techniques to satisfy the needs of all parties to an M&A transaction. BVX^® does not use any market data, nor does it use any known valuation formulas, or methods.  

BVX^® has many unique features and capabilities that are not available elsewhere. For example, BVX^® provides a simultaneous determination of Best Business Value, Required Buyer Equity, Required Gap Funding (often financed by the Seller), and Mezzanine Equity. 

BVX^® provides two tools in one program. As a valuation tool it provides BVX^® Best Value. As a deal structure tool it interactively provides financial performance of the business and Buyer’s ROI (Return On Investment). BVX^® is useful for simple transactions with no bank debt to complex deals involving mezzanine financing, balloon note, deferred payments, and over advance loans. 

BVX^® makes business valuation more objective, precise, and simple. It operates from one screen in an interactive manner. Its quickness can become an addiction to test various scenarios and develop insight into improving shareholder value. BVX^® inputs are easily available and require no (or limited) guesswork. These inputs, which are limited to the ones that are most critical to the value of a typical business, have been chosen based on years of extensive analysis and market research. BVX^® requires selected inputs from the following categories: a) Income Statement, b) Balance Sheet, c) Growth Assumptions, d) Financing, e) Deal Structure, f) Taxation, and g) Exit Strategy, and a few others.  

Financing of the transaction and creative deal structures play a critical role in BVX^® valuations. BVX^® differentiates business value depending upon purchase price allocation, buyer synergy, and the acquisition method (specifically between the “Assets Purchase” and the “Stock Purchase” acquisition method).  

BVX is designed for small and medium size privately held businesses; however, it can also be used for large corporations and public corporations. BVX^® determines the operating value of the business, which is often called the “Enterprise” value. “Equity” value of the business can be calculated by adjusting for the excluded non-operating assets, the non-operating liabilities, and the debt obligations. (See Price, Balance Sheet, & Profit). 

Business ValueXpress^® is a Corporate Finance Tool rather than an accounting or legal tool. Its purpose is not to provide litigation support or to comply with IRS requirements. BVX^® derives its usefulness and simplicity by focusing on the few key aspects of buying and selling a business. BVX^® results should be carefully reviewed with accountants, attorneys, and other M&A professionals.