Warren Buffet is widely regarded as one of the most successful investors in the world… he is often quoted as saying
“if a seller doesn’t know the value of their company, it is both legal and ethical to steal it for less”.
Clearly, a professional, independent valuation is essential to know the truth of a company’ value, and for more reasons than just its pending sale.
A company valuation is important for many reasons; the most common is to determine the Fair Market Value of a company.
If a company is priced too high, it will not attract any buyer interest and is highly unlikely to sell at all. If a company is priced too low, it may well attract considerable interest and offers, but the owner may leave hundreds, thousands and sometimes millions of pounds on the table.
According to a recent study, 4 out of 5 companies that actually sell do, in fact, leave 30% to 70% of their value on the table.