Valuations of goodwill
Goodwill is the present value of the super-profits generated by a company, corresponding to the intangible value of the company.
Purpose:
An estimate of the value of an activity, business or company, taking into account either the premium that a third party would be willing to pay to acquire it in operation, or the ability to generate profits in excess of the investments made to develop an activity (not to be confused with the goodwill measured by a PPA in business combinations). INTANGIBLE, but with differentiated treatment.
It is most commonly requested to determine its value for collateral purposes in mortgages and pledges.
Its value is usually higher than the value of the fixed assets, which is why the financing of these transactions is usually instrumented by pledging these assets as collateral.”
Purposes:
Acquisition of companies, financing processes, related-party transactions.
