Optimizing Capital Structure and the Level of Debt Assumption
January 15, 2019
In many valuations, particularly those involving the valuation of a controlling interest, the appraiser will, in many cases, need to adjust to a hypothetical capital structure that is in line with what a hypothetical control-level buyer would expect to employ.
The most conventional method for estimating this hypothetical capital structure is based on public company data. This is likely diriven by the goal of achieving objective and relatively simple methods for obtaining valuation assumptions. Unfortunately, while objective and simple, purely relying on data from publicly traded industry participants can be an over-simplification that leads to inaccurate results.
Learn more by viewing the full article in the Building Value Newsletter.