Equity Value
Equity value is the value of the shares in a business. In the simplified model, it equals enterprise value less net debt.
Equity value represents the value of a company’s shares. In the simplified valuation model: equity value = Enterprise Value − Net Debt. A detailed valuation may account for other items, such as nonoperating assets or differences in working capital.
In a Share Deal, equity value provides a basis for assessing the shares. The amount ultimately agreed may differ.
Example
Enterprise value of EUR 6.6 million less net debt of EUR 1.1 million gives equity value of EUR 5.5 million, assuming no further adjustments are needed.
Related terms
Equity value is the value of the shares in a business. In the simplified model, it equals enterprise value less net debt.
Related terms