Broker Opinion of Value
Determining the value of your healthcare practice requires distinguishing between a formal business appraisal and a business valuation, also known as a “broker’s opinion of value” (BOV).
A BOV is an opinion provided by a broker on the value of a practice based on their personal analysis, industry experience, knowledge of local lending, and comparable sales transactions. While it is not a formal business appraisal, an experienced business broker should be able to provide an accurate BOV and communicate a realistic Most Probable Sales Price (MPSP) range.
A BOV helps a healthcare business seller set realistic expectations for what their practice will sell for, given the pool of potential buyers at that given time. It is also used to develop an asking price for smaller practices. For large healthcare businesses, the target price is often kept a secret.
The broker can explain how different deal structures can impact the sales price and associated taxes. The broker should be part of your overall advisor, collectively considering the implications of different deal structures.
If you want to learn more about valuing your practice or scheduling a Broker’s Opinion of Value, contact Strategic Medical Brokers to speak with an experienced business intermediary.
