Valuation (the price one party will pay another for a business in a transaction) is based on what you can negotiate. And, as with most negotiations, valuation is more art than science. In fact, some call it alchemy because valuation is often subjectivity masquerading as science and logic. Valuation is really the intersection of cash flow and time. In other words, how long will the Buyer take to recoup the cost of the investment? And how many years’ worth of profits is the Seller willing to take today in exchange for giving up an infinite flow of profits from that business? These factors are very critical in any reorganization - be it an M&A, divestiture, a joint venture, demerger or any other form of reorganization. Valuation engagements typically involve valuation of the business/share value by using a combination of the Income (DCF), Comparables or Asset based approach. Valuation of intangible assets issues are often inherent in case of JVs, acquisitions etc. The issues include: - The relative values of technology and other intangible assets contributed by a business unit/entity - The relative values of the ownership structure of the business unit/entity relating to the intangibles - The value of the synergies in the combined entity and in the separate units/entities brought by intangible assets An understanding of these valuation issues and the related values can be a key contributor to a successful reorganization exercise.