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Keys to a Robust Business Valuation

A rigorous business valuation requires strong technical methodologies and alignment with tax regulations. At ALS Value, we combine models such as discounted cash flow and market multiples to ensure defensible transaction prices during inspections, guaranteeing financial accuracy and tax compliance.

A rigorous business valuation requires strong technical methodologies and alignment with tax regulations. At ALS Value, we combine models such as discounted cash flow and market multiples to ensure defensible transaction prices during inspections, guaranteeing financial accuracy and tax compliance.

At ALS Value, we reaffirm our commitment to technical precision and regulatory compliance in every valuation we carry out. Under the leadership of Dr. Jordi Martí Pidelaserra, Of Counsel at our firm, we achieved the approval of an agreed transaction price without any adjustments or modifications during a tax inspection procedure, ensuring full alignment with the criteria of the Spanish Tax Administration.

Context of the Procedure

The inspection was conducted under Article 37 of the Spanish Personal Income Tax Law (LIRPF), which establishes specific valuation rules applicable to the transfer of unlisted shares.

Valuation Methodology Applied

At ALS Value, we carried out a valuation demonstrating that the market value of the Company matched the price agreed between the parties. To this end, we applied a dual approach:

1. Discounted Cash Flow (DCF) Method

  • Income-based approach, using a discounted cash flow valuation through a 10-year financial projection based on historical data and market outlook.

  • Application of a discount rate (WACC), calculated using the CAPM model, considering systematic risk and capital structure.

  • Calculation of the company’s Net Present Value (NPV), discounting future cash flows and the terminal value estimated using the Gordon Growth Model with the WACC.

2. Market Multiples Analysis

  • Comparison with transactions involving companies in the same sector.

  • Analysis of transaction multiples of comparable companies, obtained from our financial databases (Eikon, Capital IQ, and Pitchbook).

Conclusion

This case demonstrates the importance of applying robust valuation methodologies that are aligned with current tax regulations. At ALS Value, we remain committed to technical excellence, ensuring that our valuations are not only precise but also regulatory-compliant and defensible.

If your company requires a rigorous and technically sound valuation, contact us to receive expert advice and tailored solutions.

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