Assessing a Company's Worth
A recent Price Waterhouse Cooper report claims most merger and acquisitions (M&A) will come from the middle market and smaller firms. Late 2009 already saw some notable M&A activity in the microwave industry. In November, Channel Microwave was acquired by Smiths Group plc (now operating as an independent division of Lorch Microwave Inc.). Last December, Spectrum Microwave Inc. acquired Micro Networks Corp., a subsidiary of Integrated Device Technology Inc. (IDTI), for a total purchase price of approximately $13 M. That same month, Crane Co. signed a definitive agreement for the acquisition of Merrimac Industries Inc. for $16.00 cash per share of common stock and associated common stock purchase rights (transaction valued at approximately $52 M).
So how does a potential seller determine the worth of his/her company when an interested buyer makes an offer? In this month's MarketWatch, Kenneth F. Stern, President and Founder of Synxronos, discusses some of the fundamental issues that need to be considered when assigning value to a company. Good to know information, whether you plan to sell or hold.
Read online at www.mwjournal.com/marketwatch/stern.