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Mergers & Acquisitions

John Wagner

Leveraging the seller

When you get an offer for your company, the first thing your eyes will jump to on the letter of intent is the TEV, the Total Enterprise Value, a.k.a. the amount that the buyer is offering for your business in sum total.
John Wagner

Never be the first to say the price

This is true whether someone is selling a pickup truck or multi-million-dollar lumber dealerships. The seller names a price, and it goes only down from there, never up.
John Wagner

Structure earnouts to the seller’s advantage

In most deals, the seller believes their company is worth more than the buyer wants to pay.
John Wagner

OPEX reductions may wipe out pandemic losses

The reduction of sales has seen a coincidental reduction in operating expenses (OPEX), as reduced operations demand less cash.
John Wagner

Take an acquirer’s view of your company

It's human nature to wonder how you stack up against competitors. Are you as profitable? How does your profit as a percent of sales revenues affect your company’s value?
John Wagner

When is a deal priced?

Most companies seek acquisition when they are on an upward trend, putting up numbers each month that are higher than the previous month.
John Wagner

Don’t let the COVID-19 pandemic devalue your LBM business upon sale

For LBM companies that are now in the process of seeking acquisition—indeed for almost every company—the COVID-19 pandemic has suppressed sales revenues and resulting EBITDA.
John Wagner

Beware of financial engineering

For successful, growing companies, there is simply no need to allow an acquirer to pay you with your own money.
John Wagner

Don’t let the COVID-19 pandemic devalue your LBM business upon sale

Here’s how to credit COVID-19 losses to earnings when selling your company.
John Wagner

Revenue is not profit

In each and every deal we do, potential acquirers will want to know the revenues, sure, because that will show the orders of magnitude of the EBITDA.

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