A stable organization is an organization that is aware and
acknowledges the uncertainty of the market, which are endangering its stability
and might undermine organizational dynamics.
these kinds of situations, various actions are taken to improve positions and
to contribute to the stability of the organization, if God forbid, the
stability of the organization was damaged, it is required to react and take
action. This is done by assessing the organization’s value, an examination of
the organization to take steps towards a restructure, and in certain situations
to consider and act to assimilate it within
other organizational structures.
In valuation, we evaluate and
analyze the property, business, merchandise, fixed income, etc. These estimates
are based on several methods because there is no one method to evaluate all
types of assets.
Under valuations are
the following tasks:
In the process of merger and
acquisition, a change in structure, along with the transformation of the main
control in charge of the business. When the process is
not carried out and\or properly embedded, the result and implications can be
devastating for all of the business units involved.
Auren Israel serves as a
bridge between purchasers and companies (as well as purchasers from abroad who
expressing interest in Israeli companies); between various types of organizations,
which are striving to perform a merger. Auren assists these companies and organizations
at all of the stages of business or employment.
The financial department learns the specific
and special needs of the clients, to customize the work methods accordingly. To
create a dedicated business strategy that meets the needs of the organization
throughout the process and with reference to fulfill the organization’s future
The department’s work process
includes the conduction of due diligence.
Due diligence is an
investigation or review for a potential investment or product to confirm any
financial aspects that may affect prior to entering into an agreement or
financial transaction with another party and is conducted by reviewing
Its significance lies in the
area of responsibility for full disclosure of material information related to
the property that is for sale. Therefore, due diligence has become a standard
stage in IPO (Initial public offering) and is undergoing an underwriting
process to ensure that all relevant information pertaining to the asset under
consideration has been disclosed to the potential investors.
The following list of due
diligence steps is not complete as there are many
types of securities and as a result, many variations of due diligence:
1. Analysis of the capital (total value)
of the organization.
2. Overview of Income and
Profits of the Organization: It is important to keep track of any trends in
the income of the organization, operating expenses, profit margins and return
3. Competitor and Industry
Review: Each organization is partially defined by its environment of
competition and competitors in it. A look at its main competitors teaches a lot
about the state of the organization, i.e., does the organization lead in its industry or in specific
target markets? Is the industry likely to grow?
Perform due diligence on several organizations in the same branch can provide
investors with insights on the organization and especially if it has advantages
over its competitors.
4. Multiplier Assessment: There are many financial ratios
and metrics that investors can use while assessing organizations. There is not
one ideal value for all types of investment, and it is, therefore, advisable to
integrate connections into different parameters to create a complete picture
and lead to a more informed decision-making process. For example, a
price-to-earnings ratio or a price-to-growth rate or sales ratio.
5. Management and Shareholders Review:
Is the organization still managed by its founders? Research conducted by the
board members to examine their own focus and professional experience. The
examination of the shareholders and their retention ratio might indicate the
organization’s status. Does the person in the management have many shares?
(there is a connection between the management holding the shares and the desire
to benefit from the shares).
6. Balance Sheet Review: An overview
of assets and liabilities, as well as the amount of cash to monitor and
supervise the level of debt, and how is it compared to other organizations in
the same industry. Big debt is not necessarily a bad thing; this determination
depends on the business model of the organization and the nature of the
industry. The goal is to see if the organization can provide enough cash to pay
off debt and dividends.
7. Stock Price History:
Is the stock volatile or stable? (it is important to remember that past prices
do not necessarily predict future price movements).
8. Dilution Inventory: Investors
need to know how many shares exist for the company and how that number is
relative to the competition. Does the organization plan to issue additional
shares, thereby reducing the proportion of shareholders or actually diluting
its number of shares?
9. Examining long-term and
short-term risks: Understanding the risks inherent in the industry as well
as the organization’s specific risks. Are there any political or regulatory
risks? Is the management stable?
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Email or ask us for an appointment.