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Benefits of Making Business in Nepal | Buy & Sell Business

At MergersCorp we help our clients confidentially buy and sell privately held businesses, aligning the interests of all parties for mutual success and satisfaction.<br><br>Find more at: http://mergerscorp.com

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Benefits of Making Business in Nepal | Buy & Sell Business

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  1. BENEFITS OF MAKING BUSINESS IN NEPAL WWW.MERGERSCORP.COM

  2. At MergersCorp M&A International we help our clients confidentially buy and sell privately held businesses, aligning the interests of all parties for mutual success and satisfaction. It is our goal to make the process of either buying a new business or selling your current business as smooth and efficient as possible. We know how important confidentiality is to our sellers and we treat it with the utmost importance. WWW.MERGERSCORP.COM

  3. BENEFITS OF MAKING BUSINESS IN NEPAL WWW.MERGERSCORP.COM

  4. Country Overview Nepal, country of Asia, lying along the southern slopes of the Himalayan mountain ranges. It is a landlocked country located between India to the east, south, and west and the Tibet Autonomous Region of China to the north. Its territory extends roughly 500 miles from east to west and 90 to 150 miles from north to south. The capital is Kathmandu. The major rivers of Nepal—the Kosi, Nārāyani (Gandak), and Karnāli, running southward across the strike of the Himalayan ranges—form transverse valleys with deep gorges, which are generally several thousand feet in depth from the crest of the bordering ranges. The principal and official language of Nepal is Nepālī (Gorkhali), spoken in the Tarai and the mid-mountain region.

  5. Executive Summary In Nepal a vast majority of the population is Hindu, but a small percentage follows Buddhism or other religious faiths. Nepal is a young country, with more than three-fifths of the population under 30 years of age. The birth rate is about the same as the world average, while the death rate is lower than the world average. Life expectancy is 70 years for men and 72 years for women. Nepal’s economic freedom score is 53.8, making its economy the 136th freest in the 2019 Index.

  6. Introduction – Doing business in Nepal Nepal is ranked 94 among 190 economies in the ease of doing business, according to the latest World Bank annual ratings. The rank of Nepal improved to 94 in 2019 from 110 in 2018. Government of Nepal has developed liberal foreign investment policies to attract maximum foreign direct investment into the country and instituted a ‘one-window’ system to facilitate and encourage such investments.. Tourism already plays an important role in Nepal’s economy. It remains one of the country’s most promising sectors for attracting FDI because of its incomparable natural assets, religious sites and therapeutic treatments.

  7. Conducting business in Nepal The main forms of business vehicle in Nepal are: • Sole proprietorship • Partnership firms • Limited liability companies • Co-operatives. Registration of local subsidiary. An overseas company can register either a joint venture company, or a fully owned subsidiary company in Nepal. A private company is the most common corporate vehicle used by foreign companies seeking to establish a business presence in Nepal, for the following key reasons: • Limited liability. • A separate legal personality. • No requirement of renewal on an annual/periodic basis.

  8. Taxation in Nepal mid-July of the following year - the exact dates vary as per local calendar. Tax at the rate of 25% of the net profit is applicable for companies in Nepal (with concessional rates for industries operating in specified areas). Value Added Tax (VAT) is levied on supply of all goods and services within Nepal except exempted and zero rated items as listed under schedule 1 or 2 of the Act respectively. Non-Residents are taxed only on the income earned or received in Nepal during the tax year at a flat rate of 25% on the Total Income. Income year in Nepal is calculated from mid-July of one year to

  9. Trade Nepal is the 153rd largest export economy in the world. In 2017, Nepal exported $803M and imported $9.6B, resulting in a negative trade balance of $8.75B. In 2017 the GDP of Nepal was $24.9B and its GDP per capita was $2.7k. The top exports of Nepal are Non-Retail Synthetic Staple Fibers Yarn ($80M), Knotted Carpets($71.1M), Flavored Water($45.9M), Fruit Juice ($45.4M) and Nutmeg ($42.8M), using the 1992 revision of the HS (Harmonized System) classification. Its top imports are Refined Petroleum($1.04B), Semi-Finished Iron($447M), Planes, Helicopters, and/or Spacecraft ($330M), Gold($246M) and Large Construction Vehicles ($233M).

  10. Banking in Nepal There are 28 commercial banks in Nepal along with 40 development banks and 32 finance companies having paid up capital of not less than Rs. 8 billion, Rs. 2.5 billion and Rs. 800 million, respectively. The total core capital of commercial banks is 288 billion rupees. Total deposits and loans of all commercial banks of Nepal is 2,093 billion rupees and 1,736 billion rupees, respectively (as of mid-July 2017). Out of the total loan of 1,736 billion rupees, local currency loan is 1,710 billion rupees.

  11. Our M&A Process NEGOTIATION & CLOSE POST MERGER INTEGRATION (PMI) INTEGRATION (PMI) POST MERGER TARGET APPRAISAL APPROACH DUE DILIGENCE Key Areas  Target & market analysis;  Initial assessment of synergies & value drivers;  Indicative valuation;  Go or No-Go decision;  Preparation of transaction documents (NDA – Non- disclosure Agreement/LOI- Letter of Intent);  Select Transaction team;  Appoint advisors;  Consider funding ability.  Initial approach letter;  Signing of NDA;  Prepare & share initial information requests;  Formulation of LOI (Letter of Intent) & possible negotiations;  Initial meeting and Q&A;  Circulate information on the Target to the Transaction team.  Set scope of due diligence;  Set up VDR (virtual data room);  Coordinating of due diligence, further meetings and Q&A sessions;  Consider points relevant to the Post-Merger (PMI) phase;  Revisit indicative valuation & prepare detailed valuation based on due diligence findings;  SPA negotiations with the seller;  Development of final structure (share/asset deal) and final valuation;  Approvals;  Signing of SPA & Close.  Consider the extent of integration;  Development of 100 Day PMI Plan;  Consider short & long term objectives;  Estimate requirements to capture synergies;  Determine resource needs & optimal allocation. Parties Involved  CFO;  Head of M&A;  Accountants;  Corporate finance advisors;  Consultants.  Senior management;  CEO, CFO, CTO;  Strategy director;  Head of M&A;  Head of Business Development;  Consultants.  Company general counsel;  Lawyers;  Senior management.  Company general counsel;  Lawyers;  Senior management/HR. 11 © Midaxo 2018 www.midaxo.com

  12. Looking to Buy or Sell a Business? CONTACT US NOW FOR A FREE BUSINESS VALUATION WWW.MERGERSCORP.COM

  13. MergersCorp.com The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. Member firms of the MergersCorp network of independent firms are affiliated with MergersCorp International. MergersCorp International provides no client services. No member firm has any authority to obligate or bind MergersCorp International or any other member firm vis-à-vis third parties, nor does MergersCorp International have any such authority to obligate or bind any member firm. Copyright © 2020 MergersCorp International. All rights reserved. 13 © Midaxo 2018 www.midaxo.com

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