Business Valuation Mandate for an Industrial Group Strategic Review

Mandate Description

The objective of the mandate was to determine the real economic value of a French company active in the formulation, processing and distribution of technical products for the aeronautical, energy and automotive sectors.

The valuation was conducted as part of an internal strategic review, prior to the update of the group’s financing plan and the preparation of future external growth transactions.

Key Issues

The main challenges of the mandate were to measure the consolidated economic performance of a multi-site and multi-country group.

A key objective was to identify value creation levers linked to sector diversification.

The valuation also aimed to assess the resilience of margins in an environment characterised by evolving production costs and changing supply chains.

Approach and Results

The valuation relied on several complementary approaches.

• A discounted cash flow approach was applied, based on detailed forecasts by sector of activity.
• A market multiple approach was also used, drawing on a panel of comparable European industrial companies.
• In addition, sensitivity analyses were conducted on the cost of capital, growth assumptions and consolidated profitability.

The analysis resulted in a coherent and defensible valuation range, validated by the finance department and used as a reference within the strategic review process.

The work also made it possible to identify the most profitable business lines and to document the group’s key differentiating factors, including technological innovation, the quality of its industrial assets and geographical diversification.