BUSINESS VALUATION FOR RESORT AQUISITION

CASE STUDY

SITUATION / BACKGROUND

A central Arkansas bank was looking to finance a Florida resort acquisition for a buyer. SBA loan application required an independent business valuation to determine the value of the business to support the loan.

CHALLENGE

• Property had strong assets, but its performance and reputation had declined significantly
• Investor needed to show strong projections and management team experience

STRATEGIC STEPS

• Spent time with buyer to understand the business and overall investment to restore resort to a destination
• Valued the resort based upon a strategic value showing market share expansion due to expertise

RESULTS

The result of the work yielded a strong valuation to support the SBA loan request.

• Market Understanding

Spending multiple days onsite with the potential buyer enabled a deeper understanding of the market-share expansion and expertise to capture opportunities with the property.

• Cash Flow Analysis

Based upon research in the market, supporting financial projections were able to conservatively show required cash flows for the loan.

• Valuation to Support $5M Loan

The resulting strategic valuation supported the loan amount to secure financing for the investor.