Valuation News - May 2023

In the May issue of Valuation News, we structure the multitude of terms used in theory and practice for various value terms and concepts, discuss the implications of current capital market developments for the applicability of multiples valuation and show the relevance of strategic valuations in the context of the so-called 'business judgement rule'.

Business administration, valuation and accounting practice use a variety of different terms in the context of business valuation to designate the valuation result sought in each case. In our first article we structure an increasing variety of terms in the field of value terms and value concepts. In the second article, we discuss the impact on multiples valuations of the rise in interest rates in the bond markets as a result of the abrupt end of the low-inflation environment and the initial rise in market returns in the equity markets, which have since declined again but are still currently elevated in a time comparison. The legally codified Business Judgement Rule imposes requirements on company management to act in the best interests of the company and thus its shareholders, and to reduce its own potential liability risks by complying with them. The third article presents valuations in the context of strategic decisions to assess options for action in the context of transactions and transformations as a basis for decisions that are justifiable in the sense of business judgements.