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£148,000
Central value of the whole company
Read the case study →LogisticsEmployee ownership
Employee ownership trust: valuing a 48-person logistics firm
Details have been anonymised and some figures rounded to protect client confidentiality.
- Sector
- Freight and logistics
- Purpose
- Sale to an employee ownership trust
- Size
- c.£8 million turnover, 48 staff
- Region
- Southern England
£725,000
Central value of the whole equity
£390,000
Maintainable EBITDA
3.85x
Central multiple
c.£122,000
Market cost of the managing director's role
The situation
The owner of an established regional haulage and distribution business was considering a sale to an employee ownership trust, the route his employee ownership adviser had recommended. He wanted an independent figure the trustees could rely on.
The difficulty
The owner's expectation was £1.5 million, based on a verbal offer the previous year that was never put in writing. Profits had fallen in the latest year. The managing director was paid around £45,000, far below what the trust would need to pay a replacement.
What we did
We charged the managing director's role at a market rate of around £122,000. We tested three alternative constructions, including a three-year average and a £1 million conclusion, and rejected each because the evidence did not support it. Net debt of around £775,000 came off the enterprise value in full, as it would in any sale.
The outcome
Whole equity value of £630,000 to £825,000, central £725,000, on maintainable EBITDA of £390,000 at 3.6x to 4.1x. The unevidenced offer was recorded but given no weight.
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