Valuation of Listed Company


A business case of how the dVT Group facilitated a reverse takeover transaction to allow a national Australian business to enter the New Zealand market. This involved an independent expert report and business valuation to analyse the effect of the transaction for shareholders of both companies, as well as determine the current and future value of the business.


Situation:

The dVT Group were asked to see if we could assist a party who was successfully operating a national
business in Australia but wanted to expand into New Zealand and was also looking to have the company
listed on the Australian stock exchange.
From our discussions, it became clear that a “reverse takeover” would be the best solution and a possible
target had already been identified by the client. We were asked to carry out an independent expert
report into the transaction, which was required to satisfy Australian and New Zealand statutory
obligations.

Actions:

A major part of any independent expert report is to analyse the effect of the transaction (i.e. the
acquisition of the target) on the shareholders of both companies. This involves not just crunching the
numbers for the acquisition price, but also comparing those numbers to the current and likely future
value of the individual and combined businesses. To that end, a valuation was also carried out on the
current and combined businesses and that was also done by the dVT Group.
We then came across another difficulty, being the difference in rules and regulations between Australia
and New Zealand for financial transactions and reports. While in Australia we were authorised and
licensed to prepare independent expert reports, there is no such requirement in New Zealand. However,
no report will be accepted by the New Zealand Stock Exchange unless the party preparing the report has
been approved by them.
dVT then had to undertake a series of checks and applications through legal firms and the New Zealand
Stock Exchange before being officially recognised as an approved party for the reports.

Outcomes:

The report was completed and lodged with both New Zealand and Australian stock exchanges. The
shareholders of both companies met and voted overwhelmingly to accept the proposed acquisition, and
the combined operations continue to this day.