Location: Conroe, TX
This analysis is for Wedgewood Golf Course located in Conroe, Texas. The listed price of the golf course and facility is $2,900,000. This model consists of a pro forma income statement, balance sheet, free cash flows, cost of capital (WACC), internal rate of return, and includes an optional expansion in a low market plan based on market assumptions. This model also allows for various inputs to be changed. We have highlighted the input cells with blue fonts.
We included our analysis of our recommended purchase price of $2,522,089. The calculated IRR and WACC equal 8.13%. The total debt is $1,715,557, compared to the total equity of $3,173,154, which comes out to be 35% debt and 65% equity.
We recommend to not purchase this business based on our analysis. One reason for this recommendation is that we feel the asking price is overvalued by $400,000. Our assumptions are on the generous side, meaning that the actual value of the company could be less than what we have stated.