Valuation for Circular Disclosure

Mergers and Acquisition (“M&A”) is one of the most common methods for companies to achieve additional growth by creating synergies or gaining access to unique capabilities. Whether the M&A adds value to the firm depends fundamentally on a proper evaluation of the transactions. Increasing concerns about the fairness of the transactions are also observed among the public. Regulators are imposing stricter rules and disclosure requirements on transactions.

 

Listed companies are required to disclose details of the transaction, in particular the basis upon which the consideration was determined, if it is classified as a share transaction, disclosable transaction, major transaction, very substantial disposal/acquisition or reverse takeover as soon as the transaction has been finalized under Chapter 14 of the Main Board Listing Rules of the Stock Exchange of Hong Kong (“HKEx”) and Chapter 19 of the GEM Listing Rules of HKEx. The Securities and Futures Commission has issued guidance in 2017, with a further statement issued in July 2019, on use of valuations in corporate transactions to the directors, emphasizing the need for determining a fair and reasonable consideration of the transactions.

 

We have extensive experience in providing business valuation services ranging from the U.S. and Hong Kong listed companies, pre-IPO candidates and small and medium sized enterprises. Regardless of the complexity of the deal structure, our dedicated team is capable to assist you in selecting the most appropriate business valuation techniques to smoothen the work progress.