[jwasbury]

I'm not experienced with aviation businesses, but as CFO of a global financial services firm I have been involved in a lot of M&A situations (both on the buy and sell side). Everyone who has posted prior regarding EBITDA or revenue multiples is on point. Typically you'll try to find comparable companies that have sold (or are publicly traded) so you can use the implied multiples from those businesses applied to the target. You may be hard pressed to find the perfect comparable though. Aside from the comparable company valuation approach, its also customary to to a discounted cash flow valuation approach.

Conceptually (beancounter talking now), anything you pay above tangible net asset value (TNAV) represents intangible asset value, such as goodwill, intellectual property (trademarks, tradenames or software in the case of IT businesses), customer lists, non-compete etc. In your example, this is the $1.2m premium over the liquidation value of hard assets. Doesn't sound like their is much if any IP or customer relationship value, so that's all goodwill.