Metis Partners was engaged by a Private Equity firm to provide IP valuation advice ahead of it making a cash injection. The Target was a manufacturer of luxury yachts that has created a wealth of IP that is not fully evident from its financial statements. The Target was seeking growth capital.
Our Client needed an appraisal of the likely ‘downside’ value of the IP portfolio to help support their lending decision. The Target was not in any financial distress, however the Client wanted our opinion on the likely recoverable value of the IP should there ever be a need to sell the IP in either an accelerated M&A or from a bankruptcy scenario.
Metis Partners was engaged to provide both OLV and FLV valuations. Our valuations would be relied on by the Client in its lending decisions.
Utilizing our Metisology® approach we identified that Target’s IP underpinned numerous different products, services and revenue streams. The mapping exercise and our IP diligence enabled us to fully appreciate and appraise the IP portfolio and how it extends beyond the registered IP of trade marks and designs. The Target has developed a luxury brand targeting ultra-high net worth individuals, and we identified contributory IP assets that are critical to brand identity and market positioning.
This manufacturer has also created extensive organizational knowledge that is absolutely critical to its success, including technical and manufacturing specifications, business structures and agreements to support its licensing models, brand guidelines for different B2B partners, and internal operating procedures. It represents a ‘wealth of excellence’ that drives its business principles and brand position and ensures it can achieve a price premium.
We provided an independent valuation of the IP assets that included narrative on the extent and quality of the IP, demonstrated how this IP underpinned material revenue streams and supported a luxury price point, and ultimately contributed to competitive advantage.
Our provided much-needed transparency over these ‘hidden assets’ and our Client was quickly able to understand the power of the IP portfolio and gain comfort around the likely recoverable value of assets. The Client proceeded with the lending.
Metis Partners provided a value-add by also delivering some post-valuation advice to the Client on improvements we identified to refine, improve and strengthen the IP portfolio, which in turn would protect the Client’s position, as the IP is being used as collateral.
IP Assets Valued – Brand, Trade Marks, Registered Designs, Distributor Agreements, IP Licenses, Organizational Knowledge, Internal Operating Procedures.