Strategic value ((See Chapter 32 of the Vernimmen))

Strategic value is the value a trade buyer is prepared to pay for a company. It includes the value of projected free cash flows of the target on a stand alone basis (see stand-alone valuation), plus the value of synergies from combining the company’s businesses with those of the trade buyer. It also includes the value of expected improvement in the company’s profitability compared to the business plan provided, if any. See also majority value.