Hello folks,
I am a complete valuation virgin here and I just have a question regarding DCF valuation projection of a company post M&A.
When projecting labor expenses, I am projecting both the number of future employees and the prospective salary level for the projection period.
Does it make sense if I were to gradually reduce the number of employees specifically related to Admins throughout the projection period, accounting for the reduction in abundant personnel post the merger (and under the assumption that the buyer is more "efficient?"
Would this logic stand? Have you guys ever had an instance where you gradually reduced the labor expenses throughout the projection period and if so, what was the reasoning behind em?
