Independent business valuation · Metal fabrication

You've Had an Offer for Your Fabrication Business. Is It Fair?

The offer letter gives a headline price. What it leaves out is how much of that figure reaches your bank account once hire purchase and old retentions have come off and the steel stock has been argued over. An independent valuation answers that in two working days, before you reply.

Owners of structural steel, sheet metal and general fabrication businesses usually come to us after something has happened. A larger steelwork contractor has asked to meet, or a private equity-backed group wants a regional site. The contracts manager and the works manager have put together a buyout. Sometimes a co-founder wants his half in cash, or the owner has started to plan retirement and cannot say whether the business pays for it.

Whoever names the first number has picked it for a reason. Every other party at the table arrives with a valuation of their own, and the owner usually arrives without one.

Email Mark for a free discovery call See what a valuation report contains

The stakes

What finding out late costs

An illustrative structural steel fabricator with £10.5m turnover and reported EBITDA of £1.45m. The owner had been told at a trade dinner that fabrication businesses go for six times EBITDA, and expected about £8.7m. The company and every figure below are fictional.

Illustrative figures, £000
Reported EBITDA	1,450
Owner salary raised to a market-rate managing director and estimator	(85)
Gain on steel stock bought before a price rise removed	(90)
One-off bad debt from a main contractor's administration added back	55
Spouse salary with no operational role added back	40
Maintainable EBITDA	1,370
Enterprise value at an illustrative 4.5 times	6,165
Cash at completion	1,100
Hire purchase on the laser cutter, press brakes and welding robots	(1,050)
Bank loan	(300)
Working capital below the normal level, with steel stock run down before completion	(180)
Equity value to the owner	5,735

Most of the gap between £8.7m and £5.7m comes from two places. The six times figure described other, larger businesses, and the hire purchase on the cutting and welding equipment was always going to be deducted as debt. Running down the steel stock to release cash before completion also cost the owner money, because the buyer expected a normal level of stock to be left in the business. The 4.5 times multiple is for illustration only. A real valuation sets the multiple from the evidence in your business and comparable transactions.

The numbers you have been given

Why the numbers you have been given are not neutral

Every valuation an owner hears before a sale comes from someone with a stake in the answer.

The buyer

wants to pay as little as you will accept. Their first figure is an opening position, and their advisers know where fabrication businesses get discounted better than you do.

A broker

competing for your instruction has a reason to quote high. A large number wins the mandate. Whether the market agrees comes out months later, usually in due diligence.

Your accountant

knows your numbers better than anyone, but may never have taken a business through a sale or sat across from a buyer's due diligence team.

None of them is acting in bad faith. Each one is answering a different question from the one you are asking, which is what the business is worth to a buyer today and how much of that reaches you.

Independence

Why our valuation is independent

When we value your business, we have no reason to push the number up or down. The fee is fixed and agreed before any work starts, and it is the same whatever the number turns out to be. You are not signing up to a sale, and nothing in the engagement commits you to anything further.

The report is yours. Show it to a buyer, your bank, your accountant or your family. Every figure in it traces back to one of three valuation methods, with each adjustment explained in the Excel model you receive alongside it.

Owners rarely go on to ask us to sell their business after a valuation, although it has happened. Most come to us for the reason this page exists. They want a number they can trust before someone else tells them what it is.

Who does the work

Who does the work, and what a valuation finds

Mark Ross Roberts FMVA CBCA carries out every valuation himself, with 30 years on the deal side of UK mid-market transactions. The largest corporate group he has negotiated against had a turnover of £3.2bn.

96%
In 96% of completed Achieve mandates, the price agreed at heads of terms is the price paid at completion.
Source: Achieve Corporation mandate records

The two summaries below show the kind of finding a valuation produces. They are examples written for this page, not records of real mandates, and they carry that label on the website until real anonymised deals replace them.

Illustrative example

Structural steel fabrication, Yorkshire

Turnover: £8m to £12m
Buyer: A larger steelwork contractor adding fabrication capacity
What the valuation found: The balance sheet carried retentions from completed jobs at full value, including several owed by a main contractor that had since gone into administration. The buyer proposed a working capital target based on a single month-end with the steel stock at its peak. The valuation wrote the doubtful retentions down and rebuilt the target from a twelve-month average, so the owner could answer the buyer's figure with his own.
Outcome: The working capital target was settled on the owner's figures before heads of terms were signed.

Illustrative example

Sheet metal and general fabrication, East Midlands

Turnover: £3m to £5m
Buyer: A private equity-backed manufacturing group
What the valuation found: The owner priced every job himself and held the relationships with the largest customers. The valuation costed a full-time estimator into maintainable earnings and showed how much of the order book depended on the owner staying, before the buyer raised it.
Outcome: The owner went into the negotiation with a handover plan and a price that already allowed for it, which left the buyer little to argue about on the length of the earn-out.

Sector insight

What buyers pay for in metal fabrication

Trade buyers and private equity pay more for earnings they can see continuing past completion. In fabrication the evidence for that sits in the certificates, the contracts and the order book, and a buyer's advisers ask for all of them in the first week.

Certification at the right execution class. Structural components need CE or UKCA marking to BS EN 1090, and the execution class held decides which jobs a fabricator can tender for. The Steel Construction Certification Scheme had 744 certified clients in 2024 (BCSA, Annual Review 2025), so a basic certificate is common. Approval for higher execution classes and bridgework is rarer and harder for a buyer to replicate.
Contracts that pass steel price movements on. Quotes with a short validity period, price adjustment clauses, or steel bought against the order protect margin when the market moves. A buyer reads your standard terms and the last two years of job costings to see who carried the risk.
Work spread beyond one part of construction. Industrial buildings took 417,000 of the 855,000 tonnes of constructional steelwork used in the UK in 2024 (BCSA, Annual Review 2025). A fabricator that also serves energy, infrastructure or manufacturing customers is less exposed to a downturn in one building type.
Modern cutting, forming and welding capacity. Fibre lasers, CNC beam lines, modern press brakes and robotic welding cells bought in recent years support the forecast. The buyer will want the hire purchase schedule alongside the asset register.
Coded welders and a management layer below the owner. A workforce holding current weld procedure qualifications, plus a contracts manager and estimator who can win and run jobs, tells a buyer the business keeps trading when the owner steps back.

What pulls the value down

The discounts in fabrication are predictable. Buyers apply them because each one has cost somebody money before.

Fixed-price tenders with no steel price protection. From 1 July 2026 the UK cut steel import quotas by 51% and set a 50% tariff on steel imported above them (Department for Business and Trade, Steel Trade Measure, 2026). The industry's own cost update expects the effect on structural steel prices to show towards the end of 2026 (BCSA, Steel for Life and Aecom, Costing Steelwork, September 2026). An order book priced before that, with no adjustment clause, is margin a buyer will discount.
Dependence on a few main contractors. Construction accounted for 3,841 company insolvencies in the twelve months to July 2026, 17% of cases where the industry was recorded (The Insolvency Service, July 2026). A buyer looks at who owes you money and how long they take to pay, and prices the risk of the largest name failing.
Retentions you may never collect. Old retentions are treated as doubtful whatever the balance sheet says. The government has proposed banning cash retentions in construction contracts and will consult further before deciding (Department for Business and Trade, Time to pay up, March 2026). Until that becomes law, retentions held by contractors are a risk the buyer prices.
The owner is the estimator. If every price goes out under the owner's name and the main contractors' buyers ring his mobile, a buyer assumes some of the work leaves with him, and either lowers the price or defers part of it.
Deferred capital expenditure and a weak safety record. An ageing press brake or a manual cutting line is a replacement bill the buyer funds after completion. A history of RIDDOR-reportable incidents or HSE enforcement notices comes out in due diligence and is used to renegotiate.

Most of these can be fixed, or at least evidenced, given twelve months' notice. A valuation done early shows which ones apply to your business and roughly what each is costing you in price.

Method

How we value a metal fabrication business, and why the multiple comes last

Anyone can take a year's EBITDA from the filed accounts and multiply it by a number heard at a trade dinner. A buyer's advisers will not price your business that way, and neither do we. The multiple is the last thing we set. It comes out of the work below and differs for every business, so we do not publish a typical range.

Before any multiple is applied, we test the business on:

Its defensible moat. What stops another fabricator, or a main contractor's in-house team, from taking the work? Execution class certification, approved-supplier status, specialist capability such as bridgework or architectural steel, and the time a customer would need to vet a replacement.
The market around it. A PESTLE review of the political, economic, social, technological, legal and environmental pressures on its end markets. For a fabricator that means the July 2026 steel trade measure, the UK carbon border adjustment mechanism expected in early 2027 (BCSA, Annual Review 2025), energy costs, construction output forecasts and the proposed reforms to payment and retentions.
Its competitive position. Porter's Five Forces applied to the business itself: the power of steel mills and stockholders over supply, the buying power of main contractors, the threat of new entrants and of imported fabricated steel, substitutes such as concrete or timber frames, and rivalry on every tender.
Its real competitive edge. The specific reason customers give this business the work, whether speed on site or a specialist capability, and whether that reason survives the owner stepping back from estimating.
Capital expenditure. The age and condition of the lasers, beam lines, press brakes and welding equipment, what is still on hire purchase, and what must be spent to deliver the forecast.
Frameworks and contracts. Framework places, approved-supplier lists with main contractors and manufacturers, and the secured order book, with how much of next year's revenue they already cover and on what payment terms.
Quality of earnings. Whether profits in the years before a sale were flattered by holding back capital expenditure, maintenance or welder training, or by gains on steel stock bought before a price rise. Buyers strip out stock gains and cost the deferred spend.

Only then do we value the business three ways: on maintainable earnings, on a discounted cash flow of its own forecast, and on the net value of its assets. Where the methods disagree, the gap shows where a buyer will push.

On published multiples. BDO's Private Company Price Index put the average UK trade buyer multiple at 9.8 times EBITDA in Q3 2024, and 12.2 times for private equity (BDO, PCPI Q3 2024). Over the previous four years, the trade deals behind that index averaged an enterprise value of £14.5m (BDO, PCPI Q1 2024). An average built from larger businesses says nothing about your certification, your order book or your exposure to steel prices. We use such figures only as one cross-check against the result of the work above.

We value businesses up to £450m enterprise value. The fixed fees below cover businesses with turnover from £500k to £30m, and larger businesses are scoped on the discovery call.

The accounts

Where fabrication accounts mislead

Filed accounts for fabrication businesses hide several things a buyer's accountants will find. We correct for them before anyone else does.

Work in progress on long jobs. A large structural package can run across a year end. If the accounts take margin on work that has been applied for but not yet certified, or on variations the main contractor has not agreed, profit is overstated.
Steel stock gains. Steel bought cheaply and used after a price rise inflates margin for a year or two. A buyer treats that as a one-off and removes it from maintainable earnings.
Retentions at face value. Retentions sit in debtors at their full value, sometimes for years. Amounts owed by a contractor in difficulty, or on jobs with open defects, are written down before they reach the price.
Hire purchase hidden in creditors. Finance on cutting and welding equipment is split between short and long-term creditors and is easy to miss. In a cash-free, debt-free price it is deducted in full.
Family on the payroll, or missing from it. A spouse paid for no role is added back. An owner who draws a low salary, takes dividends and does all the estimating needs a market-rate manager and estimator costed in his place.
Subcontract labour. Agency and labour-only welders used to cover peaks can mask a shortage of employed, coded staff. A buyer checks whether the forecast depends on labour the business does not employ.

The offer

The valuation, the fee and how to start

You receive a valuation memorandum, a written report and a locked Excel model, delivered in 2 working days. Mark Ross Roberts FMVA CBCA does the work himself. Nothing is passed to a junior analyst.

Annual turnover	Independent valuation	With funding feasibility
£500k to £5m	£1,200	£1,700
£5m to £10m	£2,000	£2,500
£10m to £30m	£3,000	£3,500
Above £30m	Scoped on the call	Scoped on the call

All fees exclude VAT. Funding feasibility adds the bank debt a lender is likely to advance against the business and tests deal structures on debt service cover, which matters if you are selling to a management team or buying a competitor.

How to start: email Mark at mark@achieve-corporation.com with a line on the business and what the valuation is for. You get a reply the same day, then a free discovery call that confirms the right report, the fee and the turnaround. Nothing is payable until you agree to go ahead.

Email Mark for a free discovery call

Questions owners ask

Frequently asked questions

I've had an offer for my fabrication business. How do I know if it's fair?

Compare it with an independent valuation built from your own accounts, before you reply. The valuation shows what a buyer is likely to pay, how much of the headline reaches you after hire purchase, debt and working capital, and which parts of the offer are open to negotiation.

Is an independent valuation worth it if I already have a broker's figure?

A broker's figure is often given to win your instruction. An independent valuation has no stake in the number, shows every adjustment, and gives you something to test the broker's figure against. At a fixed fee from £1,200 excluding VAT, it costs less than one point off the multiple on almost any deal.

Will you try to sell me a sale mandate afterwards?

No. The valuation is a standalone engagement at a fixed fee, and you are under no obligation to instruct us for anything else. Most owners use the report to negotiate with a buyer they already have, or to plan their next few years.

How much is my metal fabrication business worth?

There is no reliable rule of thumb. The value depends on how defensible the business is, its certification, the state of its cutting and welding equipment, the contracts behind next year's revenue, and whether recent profits include steel stock gains. A multiple of EBITDA comes at the end of that work, followed by deductions for hire purchase, other debt and working capital at completion. Published averages describe larger, different businesses.

Does EN 1090 certification increase the value of my business?

Mostly it stops the value falling. Without CE or UKCA marking to BS EN 1090 a fabricator cannot supply structural components, so a buyer expects it. Higher execution classes and specialist approvals, such as bridgework, are where certification starts to support a higher price.

Are the retentions main contractors owe me included in the price?

Usually they are treated as part of working capital or settled separately in the sale agreement. Recent retentions on contractors who pay are normally accepted at close to full value. Old retentions, and those owed by contractors in difficulty, are discounted or left with you to collect.

Is hire purchase on my laser cutter and press brakes deducted from the price?

In almost every deal, yes. Hire purchase and finance leases are treated as debt in a cash-free, debt-free price, so every pound outstanding at completion reduces the amount you receive.

What happens to the value if steel prices move during the sale?

It depends on your contracts. Where quotes carry price adjustment clauses or steel is bought against the order, the buyer sees little risk. A fixed-price order book with no protection will be tested job by job, and a rise during the sale can be used to reopen the price.

How long does a valuation take?

Two working days from receiving your accounts and management information, at a fixed fee agreed before work starts.

Is the valuation confidential?

Yes. An NDA is available before you share any figures, and your staff, customers and suppliers are not contacted.

Sources:

Valuation guides: EBITDA analysis · Earnings multiples · Asset-based valuation · Discounted cash flow

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