John D. Wagner
John Wagner is a managing director at 1st West Mergers and Acquisitions, which offers a specialty practice in the LBM sector. To learn more, contact John at: j.wagner@1stWestMA.com, or visit www.1stwestma.com.
Selling into an inflationary market
As always happens, we will cycle out of a down market and use the lessons learned to grow even more valuable companies in the future.
Parsing out deal elements as a percent of TEV
Buyers of LBM businesses are overwhelmingly private equity groups, and they think of deal elements (like senior debt, subordinate debt, seller’s notes, earn-outs, and escrows) as a percent of the total they pay for your company.
Congrats are in order! Your GPMs held steady!
A curious question has come up among some buyers we deal with who are acquiring LBM businesses.
Anatomy of a deal
There can be as many as four deal elements that make up an offer to acquire your company.
Five types of EBITDA
EBITDA is a term with a time-worn, clinical definition. It stands for Earnings Before Interest, Taxes, Depreciation, and Amortization.
Three types of acquirers
There are three general classes of buyers that might acquire your company: 1) A Strategic Buyer (strategic), 2) a pure Private Equity Group (PEG), 3) a Merchant’s Bank.
The value of a good CPA
Fact is, a good CPA is worth their weight in gold, and well worth the expense to retain one.
Mind the spread between OPEX and EBITDA
A (hypothetical) Mr. Coyle started two identical lumber dealerships years ago in a thriving area of New England. When he retired, he gave one location to one son, named Mark, and one to another son, Chris.
What is a pre-empt?
The longer I am in the M&A business, the more I realize how fragile deals can be, and how easily acquirers can walk away.
Roll-up acquisitions: How they work
The term “roll-up” describes a financial engineering process used by private equity and strategic investors, where multiple smaller companies, typically in the same market sector, are acquired and merged.