Casting a spotlight on the guideline M&A method
Abstract: Real-world M&As can provide a wealth of objective data for valuing a private business. But comparable deals are relevant only to the extent that they’re similar to the subject company. This article provides an overview of how the guideline M&A method works and how valuators cull transaction data to arrive at reliable estimates of value. A sidebar discusses possible sanity checks that appraisers can use to double-check whether their conclusions make sense.