INCENT values the shares of an urban cleaning subsidiary owned by a large community services group

As part of a strategic reorganization operation, a community services group mandated INCENT to evaluate the securities of one of its subsidiaries specializing in waste collection and urban cleaning in France and internationally.

Our mission consisted of determining a fair value of the securities at the date of the transaction, integrating the specificities of the economic model based on responding to public calls for tender and the execution of multi-year contracts with local authorities.

Two approaches were chosen for this valuation:

  • The discounted cash flow (DCF) method, to reflect medium-term development prospects based on a business plan integrating current contracts, anticipated renewals, and the pace of new contract acquisitions. This method required an in-depth analysis on our part, including modeling the cash flows associated with several dozen contracts. The analysis also took into account the specific investments required at the start of the contract (fleet acquisition, staff transfers), the sensitivity of the business model to price indices, and the growing environmental issues impacting local authority decisions.

  • The stock market comparables method, based on a panel of European companies active in the waste management sector, allows us to anchor the results of our approaches in market practices.

The INCENT team is proud to have supported this client in this strategic transaction. The mission was led by Guy Jacquot and Anne-Sophie Haniez, assisted by Arthur Heinbach.

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