START-ALLIANCE LLC. PROVIDES SHARES VALUATION SERVICES IN MOSCOW AND OTHER RUSSIAN REGIONS.

Shares (stock) valuation actually means determination of the value of the subject company (business) as well as the exact part of its portion attributable to the subject interest. Valuation may be conducted to determine the fair market value of ordinary and preference shares issued by open or closed joint-stock companies.

Valuation of shares is mostly based on determining the value of subject shares as a financial instrument generating profit for its owner. The principal forms of income are dividends and equity appreciation due to improved financial performance of the company, growth of business and asset appreciation. Therefore, the principal methods of shares valuation are the capital market method, net asset value method, discounted cash flow and income capitalization methods.

The size of the subject interest is also very important for valuation. E.g. valuation of a controlling interest usually warrants a premium for control, i.e. for the ability of its owner to appoint members of the management team and conduct management of the company. The control premium may amount to 30 – 40 percent of the average price calculated on the basis of the value of business and number of issued shares, while the minority discount may come up to 20 – 30 percent of this price. Furthermore, liquidity of the shares in question is an important characteristic significantly affecting the value of subject interest. Shares of open joint-stock companies traded on major exchanges have the highest liquidity, with closely held shares of closed joint-stock companies having the lowest liquidity.

DOCUMENTS AND INFORMATION REQUIRED FOR SHARES VALUATION:

• Copies of company's constituent documents (Articles and Memorandum of Association, Certificate of Registration).
• Lines of activities and organizational structure of the company.
• Financial reporting documents for the last 3-5 years (or for a feasible number of prior periods):
  • balance sheet
  • P&L
• Most recent auditor’s report (if audited).
• Fixed assets schedule.
• Property inventory lists.
• Information about all assets (real estate, inventories, shares of unrelated companies, bills, intangible assets, etc.)
• Analysis of accounts payable.
• Analysis of accounts receivable:
  • aging analysis;
  • by categories of receivables;
  • doubtful debts analysis.
• Information about affiliated companies (if any) and their financial documents.

This list of documents is preliminary and may be reduced or expanded after the valuer’s detailed review of the valuation assignment, depending on the purpose of valuation.