IVAS-IVSC Business Valuation Conference 2021

Keynote
Transforming Value Creation in a Post-Pandemic World

The dramatic social distancing measures that were adopted to contain the COVID-19 outbreak have resulted in a major economic crisis. The response to this crisis requires a substantial mobilization of resources. With limited capital, special attention should be devoted to assessing the health of strategically important sectors of activity to help middle income and low-income countries recover from the crisis.  Valuation standards are key to ensuring investors are able to make informed decisions in mobilizing resources necessary to support strategically important firms.  Conversely, lack of valuation standards, especially in valuation of environmental and social projects can result in missed opportunities for both firms and investors. 

Mr Ethiopis Tafara
Vice President, Chief Risk, Legal & Sustainability Officer and Partnerships, World Bank Group’s Multilateral Investment Guarantee Agency (MIGA)
Board of Trustees Vice-Chair, International Valuation Standards Council
Board Member of FINRA, Financial Industry Regulatory Authority
 

Presentation and Panel Discussion

ESG and Business Valuation – Finding the Connections and Synergies

Amidst a general concern that intangibles are inadequately recognised and reported in accounts contributing to the increasing gap between net asset values and the market value of companies, what are the opportunities and challenges of incorporating ESG factors into business valuation frameworks? How can ESG factors be measured to help organisations assess and grow their value?

Presenter 
Ms Helen Brand OBE
Chief Executive, ACCA
Co- Vice Chair of the Board, The Value Reporting Foundation

Moderator
Ms Selena Ling
Chief Economist and Head of Treasury Research and Strategy, Global Treasury, OCBC Bank
Council Member, Institute of Valuers and Appraisers, Singapore 

Panellists
Mr Michael Bray
Special Adviser to the CEO, Value Reporting Foundation

Mr Ong Woon Pheng, FCCA, CVA
Director, Corporate Finance, PKF-CAP Advisory Partners Pte Ltd   

Mr Richard Hayler
CFO, Nutrition Technologies
Member, IVSC Standards Review Board

Dr Tunku Alina Alias
Independent Director, IJM Corporation Bhd, Batu Kawan Bhd, Malaysian Pacific Industries Bhd and Nestlé (Malaysia) Bhd
 

Intermission

Fireside Chat

Singapore’s Sustainable Future and Transitioning Impact to Capital Markets

Climate change and ESG have become mainstream business issues. Investors, Boards, Regulators and Society at large are demanding businesses to respond and be transparent about the impact on their future as a result of climate change and ESG.  It is important that Business Valuers have an appreciation of these trends and factor into their value assessments the impact of corporate action or inaction in relation to climate change and ESG. In this session Harsha Basnayake, IVAS Chairman speaks with Abigail Ng about the regulatory initiatives that are set in motion both in Singapore and broader capital markets and how those initiatives will have impact on the broader climate change and sustainability agenda.

Interviewee
Ms Abigail Ng
Executive Director and Head of Department
Corporate Finance & Consumer Department
Monetary Authority of Singapore

Interviewer
Mr Harsha Basnayake, CVA
Council Chairman, Institute of Valuers and Appraisers, Singapore 
EY Asia-Pacific Deputy Area Managing Partner
 

Panel Discussion

Life After LIBOR: What You Need to Know About The IBOR Transition

With the impending IBOR Transition scheduled to take effect at the end of 2021, what changes will entities need to consider to effectively manage the transition? What challenges will arise for valuation professionals as a result of these changes? How can organisations and professionals prepare effectively for the transition to minimise impact on organisational value?

Moderator
Mr Andre Toh, CVA
EY Asean Valuation, Modeling & Economics Leader
Council Member, Institute of Valuers and Appraisers, Singapore 

Panellists
Mr Daniel Koh
Global Head, Treasury Markets, Standard Chartered Bank

Ms Lyn Lee
Head, Group Legal, OCBC Bank

Mr Robert Maxim
Director, Financial Instruments and Technology, Duff & Phelps, a Kroll Business 
San Francisco
 

Lunch Breakout Sessions

Attendees may attend any of these breakout sessions during lunch.

Breakout Session 1
Hosted by Duffs & Phelps, A Kroll Business

Presentation
Post-Covid-19 Economic Recovery and Country Risk – A Brief Update

The resurgence of COVID-19 cases due to the Delta variant are leading to a deceleration in global economic growth.  This session provides a brief update on:

•    Latest real GDP growth projections for the world economy, as well as other major geographic regions 
•    Trends in country risk in 2020 and 2021, and which regions have been most impacted by the crisis

Presenter
Ms Carla Nunes
Managing Director, Office of Professional Practice and Global Leader – Valuation Digital Solutions
Duff & Phelps, A Kroll Business

Breakout Session 2
Hosted by PwC Singapore 

Presentation
Post Covid Optimisation of Capital Structures

As finance professionals, we are often tasked with the responsibility of finding optimal capital solutions for our companies / clients. As the pandemic continues to rage on, businesses continue to be impacted in a variety of ways, and any given business, whether impacted positively or negatively by the pandemic, should seek the opportunities to seek bespoke capital solutions to help them remain comfortably solvent despite circumstances, or take advantage of the current economic climate to scale up their business or achieve other strategic objectives with cheaper capital. We will be drawing from real life examples to illustrate how certain companies have already reacted in the early days of the pandemic. 

Presenter
Mr Stephen See
Associate Director, Strategic Solutions and Turnaround Group, PricewaterhouseCoopers
 

Presentation
 
Best Practices and Mistakes to Avoid in the Discounted Cash Flow Method

The discounted cash flow method is a widely used and misunderstood method. Its external simplicity hides all the internal complexities. Mr. Hitchner will present these complex issues, the alternatives available, and what he believes are best practices including:

• Levels of reliance
• Matching the discount rate to the projected cash flows
• Proper use of the mid-year convention in the terminal year
• Normalizing capital expenditures and depreciation
• Accounting for excess depreciation and amortization
• Risk analysis and adjustments – discount rate, margins, or growth
• Normalization adjustments
• Comparison to historical earnings
• Minority vs. control cash flows
• Direct to equity vs. invested capital applications
• The use and misuse of exit multiples
• Working capital assumptions – debt-free vs. direct to equity
• Normalizing debt
• Supporting a long-term growth rate
• Sensitivity analyses and sanity checks

Presenter 
Mr James R. Hitchner, CPA/ABV/CFF, ASA
Managing Director, Financial Valuation Advisors
President, Financial Consulting Group
CEO, Valuation Products and Services
 

Panel Discussion
Alternative Investment Vehicles: Tracking the Performance of Special Purpose Acquisition Companies (SPACS) and Its Future in Singapore

According to the various industry reports, SPAC IPOs in the first quarter of 2021 have been breaking records globally, completing more deals and raising more in proceeds than in the whole of 2020. More recently however, the underperformance of SPACs in the US has raised questions on how investors can be adequately protected.

Closer to home, the Singapore Exchange has recently launched a SPAC framework and the Hong Kong Stock Exchange has come up with a consultation paper to introduce SPACs as an alternative listing structure. What considerations need to be made with SPACs to ensure the vehicle effectively safeguards investors’ interests while meeting the capital raising needs of the market? What are the key valuation issues for stakeholders to consider?

Moderator

Ms Srividya Gopal, CVA
Managing Director & Southeast Asia Leader, Valuation Advisory Services, Duff & Phelps, a Kroll Business 
Council Member, Institute of Valuers and Appraisers, Singapore

Panellists

Mr Howard M. Friedman
Partner, PricewaterhouseCoopers LLP

Mr Mohamed Nasser Ismail
Senior Vice President, Global Head of Equity Capital Markets
Global Sales and Origination
Singapore Exchange Limited

Mr Neil Parekh 
Partner & Head of Asia, Australia & New Zealand, Tikehau Capital 

Mr Raymond Tong
Partner, Rajah & Tann Singapore
 

Presentation 
Intangible Value Flowcharting: An Input to Robust and Insightful Business Valuations

Rapid changes in technology and stakeholder requirements create a dynamic context to competitive advantage and risk. As such, differentiated intangible assets are fundamental drivers of enterprise value within changing markets. The focus of this masterclass is the use of intangible value flowcharts as a dynamic framework for business and intangible asset valuation. Topics will include:

• identifying intangible assets with specificity, and gauging their earnings potential and risk profile 
• mapping changes in attitudes of consumers, investors and other stakeholders 
• charting changes in technology and competitive landscapes
• evaluate linkages between assets and value driver evolution
• integrating these insights into valuation models. 

Presenter 

Mr Tim Heberden
Partner, M&A Valuations and IP Advisory, Deloitte Australia
 

Lunch Breakout Sessions

Attendees may attend any of these breakout sessions during lunch.

Breakout Session 1
Hosted by EY

Presentation
How ESG Integration in Business and Investing Can Create Value

Environmental, social and governance (ESG) is fast becoming mainstream among financial market participants amid the push for greater ESG integration by regulators and investors and the wider appreciation for responsible investing globally. From the corporates’ perspectives, these bring risks and opportunities to businesses with society increasingly demanding greater responsibility from businesses they work for, buy from, and invest in. Ignoring ESG issues would mean exposure to significant risks, but if managed well, these could instead be turned into opportunities to get ahead of the competition. 

Highlights of this session:

• How asset managers today have begun to integrate ESG in their investment strategies, sifting out investment opportunities and managing risks
• Insights to corporate performance and value creation driven by ESG with prudent sustainability practices 

Presenters

Mr Aloysius Fua
Partner, Financial Services, Governance, Controls and Regulatory Assurance
Ernst & Young LLP

Mr Praveen Tekchandani
Partner, Climate Change and Sustainability Services
Ernst & Young LLP
 

Breakout Session 2
Hosted by Deloitte Southeast Asia

Presentation
M&A Trends and Common Deals Issues

Despite the world being hit by an unprecedented pandemic, there were many mergers and acquisitions transactions completed. The session will discuss the recent M&A trends observed in the Southeast Asia region and our thoughts on the future trends. The sessions will share some common key deal issues and address some of these issues in closing deals. The speakers will discuss how digital platform is also critical to facilitate M&A as many deals are being carried out virtually and high adoption of technology.

Presenters

Mr Leonard Woo, CVA, FCA
Partner, Financial Advisory, Deloitte Southeast Asia

Mr Nindito Reksohadiprodjo
Partner, Financial Advisory, Deloitte Southeast Asia

Mr Yap Kong Meng
Partner, Financial Advisory, Deloitte Southeast Asia

Breakout Session 3
Hosted by KPMG Singapore

Presentation
Driving Value in Deals from Differentiated Diligence

The deal landscape has changed, and deal value creation is increasingly driven by operational performance improvement. As such, a great deal of focus is placed in the pre-deal diligence stage on how operational change can drive deal value creation. Acquirers who look beyond traditional commercial and financial diligence methods are likely to make the best investment and capital allocation decisions. Similarly, sellers who understand how they can improve performance and build a stronger equity story will achieve the best returns.

This session will outline the benefits of and our approach to differentiated, value-focused diligence to provide a unique set of deal insights. We’ll also explain how you can use this diligence process to create tangible plans to unlock value creation from the outset.

Presenters

Mr Alfred Sia
Partner, Deal Strategy, KPMG Singapore

Mr Nish Teli
Director, Deal Strategy, KPMG Singapore 

In the Spotlight
Technology Companies and Value Creation

In an industry largely defined by intangible assets, intellectual property, as well as strong competition, how do technology companies measure value and retain stakeholder confidence in order to strategise for growth? 

This segment deep dives into the experience of technology companies, charting their success to date and extracting insights on how their approach to measuring value has evolved over time and how recent developments in ESG, IA, IBOR, SPACs and digital assets are impacting their ability to create and deliver value. 

Interviewee

Mr Faisal Galaria
CEO, Blippar

Interviewer

Mr Jamesy Laya, CVA
Partner and Head of Valuation Services, KPMG Singapore
 

Presentation & Panel Discussion 
Demystifying Digital Asset Valuation

What is a digital asset and what determines its value? An Oct 2020 article by McKinsey and Company, titled, “Why ‘digital’ is no different when it comes to valuation” highlighted how extensively the term “digital” could be defined across multiple functions and initiatives. 

It’s no surprise then that determining the value that such digital initiatives and assets create can be challenging. What should companies invest in and how should these digital assets be evaluated? Thankfully, there is method to the madness and the principles of valuation should help business leaders distinguish value-creating opportunities from value-destroying ones.

Presenter & Panellist

Dr Taimur Baig 
Managing Director and Chief Economist
Group Research
DBS Bank

Despite some volatility, the digital assets space remains characterised by a frenzy of activity, with numerous product and application launches, capital raising events, and regulatory actions. At the public sector level, pilots, experiments, and new initiatives with CBDCs continue to gather pace, along with greater regulatory scrutiny over cryptocurrencies. At the private sector level, the intersection of climate change and digital finance is gaining prominence, with tradable carbon tokens on the blockchain moving from concept to reality, with digital exchanges and standard setting alliances refining the creation, verification, and usage of such tokens. Bond markets are going in the same direction, with digital bonds gaining momentum.

Moderator

Mr Terence Ang, CVA 
Partner, Head of Advisory, RSM Singapore

Panellist

Ms Grace Lui, CVA
Director, Valuation & Transaction Services, Nexia TS

Mr Jason Tay
Global Co-ordinator & Regional Director of Business Development. M-DAQ Global

Presentation & Panel Discussion 
Unlocking Long-Term Value: Redefining Intangible Asset Valuation

With global intangible asset (IA) value standing at an all-time high of US$66 trillion and representing more than half of global listed value today, it is no surprise that stakeholders across the world are demanding better measurement of IA value. The non-physical nature of IAs impacts their value by giving them an infinite scalability across geographical borders, but also by making them deeply reliant on legal systems to ensure proper use. Close collaboration between valuation and legal experts at the international level will be critical to enhance the valuation of IAs and enable businesses to unlock long-term value. This segment discusses the growing demand for better assessments of long-term value arising from IAs, the potential for IA valuation guidelines and the opportunities that will arise for businesses as a result.

Presenter & Panellist

Mr Richard Stewart 
Member, IVSC Business Valuation Standards Board 
Partner, Financial Advisory, PwC

Moderator

Ms Edwina Tam
Partner, Southern Region Financial Advisory Leader, Deloitte Hong Kong

Panellists

Ms Audrey Yap
President, Licensing Executives Society International (2020/21)
Managing Partner, Yusarn Audrey

Mr Marco M. Alemán
Assistant Director General, World Intellectual Property Organisation