Extraordinary Operations

When extraordinary operations are carried out, the aim of Due Diligence is to provide information on any critical profiles liable to undermine the success of the operation. The scope of Due Diligence is defined along with the Client, depending on the specific needs to be covered.

The various PRAXI divisions offer clients the opportunity to implement full Due Diligence to supervise the following aspects:

• financial and tax issues, handled by chartered accounts and auditors
• strategic positioning, handled by the Praxi Sales and Marketing BU
• Organisation and Human Resources thanks to Praxi Management Consulting and Praxi Human Resources expertise
• IT systems, handled by the Praxi IT Division
• industrial plant and property, handled by the Praxi Valuation and Advisory Division.

Business Valuation

Establishing the effective capital value of a company or company division is a key element in supporting extraordinary operations such as sell-offs, mergers and acquisitions, both when third parties are involved and when the operations regard related parties as part of a Group reorganisation process.

PRAXI acts as a qualified, independent expert, guaranteeing all the subjects involved an objective, sustainable value assessment report, compliant with all the pertinent regulations and top international standards.

PRAXI team that deals with company valuation projects is made up of chartered accountants and auditors, who supervise the methods used and the management of the operation (identification of the valuation method, financial statements and business plan analysis, valuation development), as well as engineers and chartered surveyors if required to assess tangible assets (land, buildings, plant, machinery, etc.) and agents if required to assess intangible assets (trademarks, patents, designs, etc.).

Stages of the process

PRAXI’s intervention comprises the following stages:

• examination of documents and preliminary valuation of the company’s financial statements and business plan
• meeting with the pertinent figures in the company under valuation for further information on the analysis of the main items in the financial statements and the business plan
• determination of the valuation method best suited to the specific characteristics of the company
• valuation of the company’s economic capital and presentation of figures to management
• drafting of the final report, setting forth the purpose and object of the valuation, the criteria it is based on and the conclusions (value of the business), together with documentation attesting to the valuation process adopted
• sworn certification of appraisal if required.

Valuation of Intangibles

PRAXI offers valuation services for intangible assets such as trademarks, patents, licences and concessions, technology and know-how, client portfolios, proprietary software, etc.

An accurate establishment of the economic value of intangibles is instrumental to providing a realistic picture of a company’s assets.

In this area, PRAXI has conducted valuations of extremely prestigious trademarks, as well as patents and other intangibles in a variety of sectors (hotels, food, chemicals, design, trade fairs, finance, major retailers, mechanical, fashion, nautical, oil, etc.).

The aim of such valuations is to:

• shed light on assets that do not appear in the financial statements
• initiate/complete a process of alignment with IAS/IFRS
• determine the effective value of the company on the occasion of extraordinary operations or specific regulations issued for the revaluation of assets.

PRAXI’s multi-disciplinary structure and experience allows us to:

• assist clients in accurately identifying intangibles
• determine the most appropriate valuation methods (discounting market royalties, estimate of differential income/revenue financial flows, costo di ripristino dei diritti, historical or replacement cost)
• identify the main comparables, on a national and international scale
• conduct the valuation, applying the methods selected
• prepare the appraisal report, with sworn certification if required.

Assists clients at all stages of Mergers and Acquisitions, from defining the strategic objectives to closing the operation.

Stages of the process

Activity comprises the following stages:

• definition of the strategic objectives of the operation
• market analysis to identify targets
• preliminary contacts with the target companies
• assessment of the target companies; analysis and structuring of the transaction from an economic, legal and fiscal perspective
• preparation of the non-binding indication of interest
• specific due diligence (on fiscal, legal, environmental aspects, etc. to check for any latent liabilities) and negotiation of terms and conditions of the binding offer
• support for lawyers for preparing legal documentation and contracts
• completing negotiations and closing.