All cases
Translate a cold-storage enterprise bid into equity proceeds
Enterprise and equity value · Fictional case
The situation
Operating enterprise value is ₹250 crore. Debt is ₹70 crore, excess cash ₹20 crore and a separately valued nonoperating property ₹15 crore. Ignore other claims.
Your task
What implied equity value does the bid support?
Reveal step-by-step solution
Set up the problem
Subtract the ₹70 crore financial claim from operating value.
Work through the numbers
Add ₹20 crore of excess cash and ₹15 crore of nonoperating property: ₹250 − ₹70 + ₹20 + ₹15 = ₹215 crore.
Interpret the result
Implied equity is ₹215 crore. Verify that the property was excluded from operating value before adding it.
What to remember
List senior claims and assets excluded from enterprise value. Check for overlap before adding anything.