The Lehman method is a method of calculating by multiplying the price of a moving asset by a certain percentage. Originally, it is a result distribution method applying the doctrine of Dr. Lehman authority authority of German business science. It is a general calculation method in the performance fee of M & A closing. However, there are many places where advisors have established provisions for each advisor separately from remuneration (there is no possibility to undertake a case unless we can expect only a fee below this fee). The Lehman method can also be used to grasp the current state of the company. Since the Lehman method was originally based on allocation of achievement, the work performance of the company etc. becomes clear by passing through the process. Moreover, considering the distribution of achievement by the Lehman method, we divide the factors that enhance the company’s performance into “capital” and “labor”. Specifically, considering capital as “net profit / total capital”, we consider labor as “net income / number of employees”. This makes it possible to clarify the capital ratio and labor ratio, and to clarify the degree of contribution. It is a method of judging capital and labor and deciding the bonus by judging the company’s performance. By doing so, you can make element composition of bonus relation such as salary degree.
Used for M & A advisor’s compensation calculation
In the Lehman method, the proportion of remuneration of M & A advisor changes according to the transaction price of M & A. Portion where transaction value is less than 500 million yen · · · 5%, parts from more than 500 million yen up to 1 billion yen · · · 4%, parts from more than 1 billion yen to less than 5 billion yen · · · 3%, 50 Parts exceeding 100 million yen · · · 2%. In this way, if the transaction price does not exceed 500 million yen, the M & A advisor will have a flat fixed amount of remuneration. Calculation becomes complicated if it exceeds 500 million yen, so it is necessary to calculate with caution. If the calculation criteria for the part of the transaction price are different, attention should be paid as M & A will change the amount of payment of compensation depending on the client. The Lehman method has the object of determining employee salaries based on the company’s capital and business performance as a criterion, but there are other effects obtained from the Lehman method. Since you can learn the actual situation of the company from the Lehman method, it becomes a transaction material when selling the company. Thus the Lehman method is a way to gain a lot of benefits.