Case study - Business valuation
An 10 million euros in sales Hungarian vitamin and nutritional supplement company and strategic advice to optimise the value of the company
DESCRIPTION OF THE CLIENT AND THE PROBLEM:
- The Company is one of Hungary's leading vitamin and food supplement companies.
- The Company's management wanted to get a complete picture of the value of the Company and the opportunities to increase it. Mercurio was therefore commissioned to evaluate the company using a number of methodologies and to make recommendations to increase its capital value.
OUR APPROACH:
- The project examined the company in a broader context than a traditional evaluation project. Our aim was to help the owners of the Company to increase the value of their company. We linked our recommendations for value enhancement to the methodology used in the company valuation to illustrate how a given measure affects the value of the company.
- During the project, we valued the company using multiples and a discounted cash flow (DCF) method and made recommendations to increase the value of the company. Our recommendations focused on optimising working capital, taking ESG considerations into account, restructuring the product range and better defining leadership roles.
- We have analysed the latest capital market developments in the dietary supplement and generic pharmaceutical markets and developed our set of proposals in light of this.
RESULTS:
- A 25-page valuation report based on the detailed application of two different valuation methods. The associated extensive, forward-looking excel-based financial model was built in close collaboration with management in a bottom-up manner
- An analysis of the Company's market position, strengths, opportunities and value drivers identified in the company's valuation was provided in pdf format.