Principle

Non-patented know-how represents a key element in a company valuation’s process. It generally concerns a technical field but can also be commercial, marketing related or organisational…

General agreed accountancy norms cannot always valuate the non-patented know-how independently from the goodwill. However, know-how carries a real financial value for the buyer. It is generally valuated in terms of reconstitution costs. To be accurate, this approach will require a detailed appraisal of both know-how’s contents and specificities.

In some cases, even non patented know-how can be subjected to licence fees or technological transfer agreements. It is then suitable to determine the financial conditions of these transfers.

Applicability

 Acquisition or handover of know-how,
 Negotiation over collaboration or merger involving reciprocal exchange of know-how contributions.
 Internal restructuring,
 Purchase Price Allocation (PPA),
 Determination or justification of the licence fee rate as well as other licensing or transfer financial conditions for the know-how.
 Prejudice resulting from the divulgation or misappropriation of a secret know-how

Method

Our approach on know-how valuation includes:

• Identifying the know-how and analysing its strategic interest. If ever there is a fundamental technical aspect, we will carry out the analysis with qualified partners in the field.
• Analysing the conditions of commercial valuation of the company, both internal (direct exploitation) and external (licence, transfer).
• Financial valuation of the know-how either by the reconstitution costs’ method or by future income methods.

Results

 Technical, commercial and financial mapping of the know-how.
 Recommandation to optimise the financial value of these know-how
 Documented report on both the nature and financial value of the know-how.

We helped them :

 DCN, Biomérieux