Reasons for a Valuation of Your Practice

Article by Mark Ridout, director of R A Valuation Services Ltd

It is not just at the point of practice sale preparation that an accurate business valuation may be required. R A Valuation Services Ltd, the optical sector’s specialists in practice valuation, undertake independent valuations for many reasons, including the following:

  1. An internal transfer of ownership in whole or part. This could include the gradual or part sale of ownership or shares to a co-owner or employee. There can be many factors to consider such as fair open market value, discount applicable to a minority shareholding interest and so on.
  2. Buying into a practice – be it an independent or multiple store – a prospective purchaser should be suitably informed of the realistic market value of the business. In the present climate,prospective purchasers of businesses are increasingly seeking a formal independent business valuation. An expert’s valuation figure provides a fair and unbiased view of the worth of the business – independent of the ambitions of the seller or their transfer agent.
  3. Share schemes – increasingly schemes such as Enterprise Management Incentives (EMI) – are a cost-effective way of bringing employees into part ownership of the business, and consequently incentivising them with the practice’s success.
  4. Tax purposes including incorporation.
  5. Legal reasons such as litigation, director disputes, matrimonial settlements and so on.

More information

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