Short description: Method of valuation of a company
Sum of the parts analysis (SOTP), or break-up analysis, is a method of valuation of a multi-divisional company, holding company, or a conglomerate.
The essence of the method is to determine what divisions would be worth if the conglomerate is broken up and spun off or acquired by another company;
[1]
see Conglomerate discount.
The analysis calculates a range of values for a conglomerate's equity by summing the value of its individual business segments or divisions to get the total conglomerate's enterprise value. The equity value is then calculated by subtracting net debt and other non-operating adjustments.
References
- ↑ "Sum-of-the-Parts Analysis". macabacus.com. https://www.macabacus.com/valuation/sotp. Retrieved 2015-04-01.
Corporate finance and investment banking |
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| Capital structure |
- Convertible debt
- Exchangeable debt
- Mezzanine debt
- Pari passu
- Preferred equity
- Second lien debt
- Senior debt
- Senior secured debt
- Shareholder loan
- Stock
- Subordinated debt
- Warrant
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Transactions
(terms/conditions) | | Equity offerings |
- At-the-market offering
- Book building
- Bookrunner
- Bought deal
- Bought out deal
- Corporate spin-off
- Equity carve-out
- Follow-on offering
- Greenshoe
- Initial public offering
- Private placement
- Public offering
- Rights issue
- Seasoned equity offering
- Secondary market offering
- Underwriting
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Mergers and
acquisitions |
- Buy side
- Control premium
- Demerger
- Divestment
- Drag-along right
- Management due diligence
- Managerial entrenchment
- Minority discount
- Pitch book
- Pre-emption right
- Proxy fight
- Post-merger integration
- Sell side
- Shareholder rights plan
- Special-purpose entity
- Special situation
- Squeeze-out
- Staggered board of directors
- Stock swap
- Super-majority amendment
- Tag-along right
- Takeover
- Tender offer
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| Leverage |
- Debt restructuring
- Debtor-in-possession financing
- Financial sponsor
- Leveraged buyout
- Leveraged recapitalization
- High-yield debt
- Private equity
- Project finance
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| Valuation |
- Accretion/dilution analysis
- Adjusted present value
- Associate company
- Business valuation
- Conglomerate discount
- Cost of capital
- Discounted cash flow
- Economic value added
- Enterprise value
- Fairness opinion
- Financial modeling
- Free cash flow
- Market value added
- Minority interest
- Modigliani–Miller theorem
- Net present value
- Pure play
- Real options
- Residual income
- Stock valuation
- Sum-of-the-parts analysis
- Tax shield
- Terminal value
- Valuation using multiples
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 List of investment banks- Outline of finance
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 | Original source: https://en.wikipedia.org/wiki/Sum-of-the-parts analysis. Read more |
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