Investment Appraisal Summary Template

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Deal Origination Report (DOR) Template

Company Name:  XYZ Ltd. (if approved remove and use “Project Name” only)

Project Name: Banana Project (only use company name after press release)

Status: Initial DOR / Active / Canceled

NDA: Yes/No

NDA Date: Tuesday, June 07, 2011

Sourced: Who sourced the deal?

Sourced Date: Tuesday, June 07, 2011

Fund Team: 1 VP, 1 Associate, 1 Analyst

Key Deal Contacts: List Name, Company, Function, Telephone, Email

Attachments: (Optional)

Next Steps:

What are the next steps needed to continue with either due diligence and/or negotiations

Investment Rationale

What is the opportunity? Why is this deal a good investment for the port fund? Discuss synergies, risk, expected returns, initial thoughts about an exit, etc


Company, Country, Region and any other pertaining information

Market Info

Initial intelligence on market size, supply, demand, niches, deficiencies and anomalies, opportunities


Key managers and initial management valuation


Ownership Structure

Company Operations

Summarized description of operations, if various business units please discuss each business unit individually

Key Clients and Suppliers

Key clients and suppliers

Key Business Assumptions

Key operation drivers, targets, etc needed to reach our valuation assumptions

Financial Summary

If available, historical and forecasted key financial summary

Detail analysis of liabilities,

  • current, short term and long term, mortgages and guarantees against them present value.

  • Tracking Changes on liabilities over the last three years
  • Ageinganalysis and litigation if any
  • Hidden cost

  • Who – what – when– and how

  • Value in the underline assets, and the analysis of the owner

Financial – Assets

  • Assets, changes in the assets in last three years, effect on financial assets and its reclassification.
  • Current Assets, fixed assets and other assets and goodwill, present value, changes and analysis.
  • Mortgage and loans against assets or any other liability
  • Receivables, inventory, ageing report and valuations.
  • Tracking changes on the every assets and where is lost value and by how much in last three years

Financial – Income Statement

  • is the income, from where it is coming and efficiencies.

  • value of income – operating

  • value of financial income and investments and value lost in financial assets.
  • Other income – realized and un realized , present status and value.

Financial – Cash Flow

  • Cash Flow analysis of last three years and tracking where money is gone really.
  • Where cash is burnt, who burnt it and how much is remaining.
  • Understanding value matrices’ of the company from cash flow statement, cash flow is the statement which can provide real insight into the affairs of the company.

Valuation Summary

If available, initial valuation summary

    • Review and selection of the methods of valuation

    • Understanding of issues which impact valuation

    • Special situations and their impact on valuation

    • What is value

    • Cost vs. Market Value

    • Historical vs. Replacement

    • Differs depending on need of person doing valuation – buyer, seller, employee, banker, insurance company

    • Value to user

    • Valued because of expected return on investment over some period of time; i.e. valued because of the future expectation

    • Return may be in cash or in kind

    • Complex nature of valuation


  • Valuation methods

These can be broadly classified into:

  • Cost based

  • Income based

  • Market based

  • Valuation methods

  • Different experts have different classifications of the various methods of valuation

  • Within these methods, there are sub-methods

  • Sometimes the methods overlap


  • Cost based methods

  • Book value

  • Replacement value

  • Liquidation value

  • Book value method

Historical cost valuation

  • All assets are taken at historical book value

  • Value of goodwill* is added to this above figure to arrive at the valuation

NOTE: Document should not exceed five pages. An executive summary and deal detail will be prepared as due diligence is completed if DOR is approved.


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