The method of valuation of a business, however, depends to a great extent on the acquisition motive. What are those motives of valuation?

Valuation and acquisition motives are an important aspect in the merger/ amalgamation/takeover activity. The method of valuation of business, however, depends to a great extent on the acquisition motives. The acquisition activity is usually guided by strategic behavioral motives. The reasons could be: Either purely financial, e.g., taxation, assets-stripping, financial restructuring involving an attempt to augment the resources base and portfolio-investment; Business related, e.g., expansion or diversification; Behavioral reasons of personal ambitions or objectives of the top management, e.g., desire to grow big.