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.
How to handle off-book inventory when selling your business
One of the last things the buyer does is perform a hard-count of the seller’s inventory so that the buyer has an opening balance sheet for their new operation.
What is a waterfall scenario?
Let's say you successfully found a buyer for your company, and you are wrapping up the due diligence process as the final stage before your deal proceeds.
‘10 and 10’ companies hold value in any market
Selling your business in an inflationary period doesn’t necessarily mean selling it at a discount.
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.