PROBLEMS OF DETERMINING THE DISCOUNT RATE IN BUSINESS VALUATION IN MERGER AND ACQUISITION PROCEDURES

The article analyzes the theoretical and methodological problems of choosing a discount rate when assessing the value of a business in merger and acquisition procedures. Based on a critical review of domestic and foreign studies, the limitations of classical approaches in terms of transactions are considered, accompanied by changes in the capital structure, the presence of synergetic effects and high information asymmetry. Six key groups of problems have been identified: the lack of uniform recommendations and the subjectivity of the choice of bid; the difficulty of estimating the beta coefficient and risk premiums for non-public companies; distortions due to the use of a single corporate rate; the impact of leverage; uncertainty about the benefits and risks of integration; poor quality of source data and volatility of macro indicators. Ways to solve them are proposed through the use of segment rates and the APV method, beta analogues, scenario analysis, separate discounting of various types of synergy, as well as auditing of baseline indicators and benchmarking by market. An analytical table is presented that compares problems and related solutions, which allows us to form an algorithm for justifying the discount rate to increase the reliability of estimates and reduce the risk of overpayment in mergers and acquisitions.