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M&A Blog #11 – buy-side acquisition

Francine Way

Thus far in the last 10 blog posts, we have discussed what M&A is, its success metrics, types of acquirers and value creations, capital structure, debt, and equity. In Blog #02 of the M&A series, we discussed SWOT analysis. and (4) support long-term business strategy. and (4) support long-term business strategy.

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M&A Blog #10 – equity (accretion / dilution)

Francine Way

Public company audited financial statements typically receive a good deal of scrutiny from accountants, equity analysts, and regulatory agencies. Private companies have a different set of goals - that is to minimize taxes, so the private company accounting tend to minimize earnings.

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M&A Blog #12 – sell-side acquisition (preparation)

Francine Way

Many of these causes have their equivalences to the reasons behind the sale of a company (also known as a divestiture): Liquidity: As the equity holding period matured, investors (private equity funds behind companies) will look to sell. Once a sale has been decided, the process to look for a new owner is pretty well established.

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M&A Blog #24 - Merger Relative Valuation

Francine Way

It has been roughly three years since my last blog post at the completion of my fellowship. To pick up where we last left off with valuation, I will cover the topic of a Merger Relative Valuation in this blog post and move on to other non-valuation topics from here. Time certainly did fly by when one was having fun.

Valuation 130
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M&A Blog #09 – debt (Part V – asset based lending (ABL) and seasonal ABL)

Francine Way

For those of us who have borrowed money based on collateral, this blog post will feel familiar. If you have listed your car or savings account in your mortgage application, you are essentially trying to get a loan based on your current asset(s). The concept can be extended to M&A. This post is the last one of our debt discussion.

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M&A Blog #19 – valuation (Leveraged Buy Out - LBO)

Francine Way

Balance Sheet Assumptions: Days Accounts Receivable (AR) = AR / Revenue * 360. Capex as % of Sales = - Capital Expenditures / Revenue. Days Payable = Accounts Payable / COGS * 360. AR = Days Account Receivable assumption (from earlier) / 360 * this year’s Revenue. Proceeds at Sale = Equity to Sponsor calculated earlier.

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M&A Blog #22 – valuation (less known valuation methods)

Francine Way

Each asset class is revalued based on its sale in a 60-90 day sales process. The valuation professionals going into these quantitative exercises may not be able to account for every variables, but they should attempt to do so to the best of their abilities. The 2nd valuation method for today is the Liquidation Value method.

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