John D. Wagner

A curious question has come up among some buyers we deal with who are acquiring LBM businesses.

There can be as many as four deal elements that make up an offer to acquire your company.

EBITDA is a term with a time-worn, clinical definition. It stands for Earnings Before Interest, Taxes, Depreciation, and Amortization.

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.

Fact is, a good CPA is worth their weight in gold, and well worth the expense to retain one.

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.

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.

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.

As an acquisition closes, the investment banker representing the seller calculates the working capital peg.

A neighborhood friend stormed into my house recently, fuming. He’d just put his house on the market and gotten a bid the very first day.