EV
Enterprise Value
Short definition
Enterprise value is the value of the operations to all capital providers (equity and net debt). It corresponds to FCFF discounted at WACC; equity value is EV minus net debt.
Detailed explanation
The bridge: EV = equity value + gross debt − excess cash + NCI ± leases/other debt-like items. Operating cash should not be subtracted from EV; that deletes an operating asset.
A multiple (EV/EBITDA) ties EV to EBITDA. DCF builds EV from cash flow. The two methods should talk under the same cash and the same WACC.
Why it matters for the CFO
If the purchase price is ambiguous between “equity” and “cash-free debt-free”, the negotiation slips. The SPA EV–equity bridge locks closing cash and debt.
How it is calculated
EV ≈ Özkaynak değeri + Net borç + Azınlık − İlişkili nakit dışı ayarlar
Variables in the formula
- EV: Value to all capital providers
How to read it
A high EV/EBITDA assumes growth or a low WACC; if cash conversion is weak the multiple is optimistic. Terminal value can be a large share of EV — sensitivity is required.
Numerical example
Equity value 800 mn TL, net debt 420 mn TL, NCI 0 → EV = 1,220 mn TL.
Related calculators
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What to learn next
Definitions are educational. They are not investment, credit or tax advice.