Francine Way

JULY 17, 2017

Building a historical 3-statement model and a debt-interest schedule. Building the go-forward debt-interest schedule. Implied Equity Purchase Price = Transaction Value - Debt + Cash. For this table, recall that LBO transactions are heavily financed with debt (it can go up to 90% of the capital structure for some deals).

Valuation 130

Valuation M&A Debt Book-building 130

Francine Way

JULY 12, 2017

Calculate cost of debt, cost of equity, and weighted average cost of capital (WACC). For interest income and expense, I prefer to state them as percentages of the average debt balance of the last two years. It is a good practice to verify the intended debt-vs-total-capital balance post-transaction when possible.

Discounted Cash Flow 130

Discounted Cash Flow Valuation M&A DCF 130

Francine Way

JULY 7, 2017

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.

M&A 130

M&A Acquisitions Consulting Capital 130

Francine Way

MAY 18, 2017

The concept can be extended to corporation: equity owners (shareholders) own the company alongside debt holders (banks). As we mentioned in the past, equity is the most expensive form of capital (compared to debt with tax-deductible interest). The acquisition will be 100% cash, paid for with debt at 4% interest rate.

M&A 130

M&A Equities Financial Statement Debt 130

Francine Way

JULY 13, 2017

Calculating cost of debt, cost of equity, and weighted average cost of capital (WACC). Enterprise Value = Market Capitalization + Total Debt - Total Cash. The major steps of Comparable Company are: Deriving the appropriate market multiples (or range of multiples). Calculating the Terminal Value and the Value of Operation.

Valuation 130

Valuation M&A DCF Book-building 130

Francine Way

JULY 10, 2017

Do they have the cash of debt/equity capacity to bid aggressively? The differences between the two are: Equity Value: This is the residual value to common shareholders after all debts and secured liabilities are repaid, also known as market value, offer value, shareholders’ interests, and market capitalization.

Valuation 130

Valuation M&A Equities Shares 130

Francine Way

JULY 9, 2017

The comparisons can be based on several factors: Valuation: Total value, structure, contingencies, forms of payment (cash, buyer’s stocks, target’s stocks, seller’s notes, post-transaction debt, and more), and deferred payments (payments based on future performance) should be evaluated.

M&A 130

M&A Acquisitions Valuation Sale 130

Francine Way

JUNE 22, 2020

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. Any debt drawdown and paydown schedule.

Valuation 130

Valuation M&A Mergers Mergers and Acquisitions 130

Francine Way

JULY 14, 2017

Implied Transaction TEV = Implied Purchase Price + Debt + Preferred Stock + Minority Interest - Cash. We add the resulting number to Basic Shares Outstanding to get FD Shares Outstanding. Implied Purchase Price = FD Shares Outstanding * Consideration Per Share.

Valuation 130

Valuation M&A Shares DCF 130

Francine Way

JULY 11, 2017

Each peer business’ share price, fully-diluted shares outstanding, total debt, total cash, last 12 months (LTM) revenue and EBITDA, book value of equity, and goodwill: Can be obtained from sources such as MarketWatch. longer-term loans (term loans, senior bonds, unsecured debts), and (small portion of) cash on hand.

Valuation 130

Valuation M&A DCF Financial Statement 130

Cisco: M&A

APRIL 22, 2024

We’ll discuss everything from infrastructure-as-code, automation, and continuous integration, to network as a service (NaaS… Read more on Cisco Blogs I often get brought into meetings when a customer starts talking “DevOps”.

Debt 96

Debt Government 96

Francine Way

JULY 20, 2017

So many factors influence the value of a company (financial performance, growth prospects, perfomance of peer companies, past transactions, the use of debt, the payment of dividends, the context of the transaction, and more). As I stated at the beginning of this valuation series, there is no one “true” or “correct” value.

Valuation 130

Valuation M&A Business IT 130

Francine Way

JULY 19, 2017

Balance Sheet: cash and cash equivalents, receivables, inventories, prepaid expenses and other current assets, Net PPE, other assets, account payable, accrued liabilities, long-term debt, deferred tax and other liabilities.

Valuation 130

Valuation M&A DCF Stock 130

RKJ Partners

AUGUST 6, 2017

In our latest blog installment, we define and outline the key elements involved in the process of raising capital. Capital is generally grouped into three main classifications: Senior Debt, Mezzanine Capital and Equity Capital. Most entrepreneurs are very familiar with senior debt offered by traditional banks.

Debt 40

Debt Capital Raising Capital Equities 40

RKJ Partners

AUGUST 6, 2017

In our latest blog installment, we define and outline the key elements involved in the process of raising capital. An added benefit for VC's is that they can improve their return on investment (“ROI”) on a given deal by encouraging their portfolio companies to take on a responsible mix of debt along with their equity dollars.

Debt 40

Debt Capital Raising Capital Equities 40

TechCrunch: M&A

JUNE 29, 2023

million debt. A widely circulated blog post claiming knowledge of the matter said Wang had been diagnosed with depression, sparking discussion on entrepreneurs’ mental health issues in China’s tech community. million in debt. million in cash. It’s also taking on the startup’s $50.66

Debt 187

Debt Investors Recruitment Food 187

Midaxo

OCTOBER 12, 2023

In this follow-up blog post, we’ll outline key takeaways and provide additional insights from questions cut for time to help you master these critical processes. Operational debt is as serious as tech debt. Additional Q&A with Mart Lumeste: Q: How Do You Uncover and Evaluate the Extent of Technical Debt?

Debt 147

Debt Architecture Business Mergers and Acquisitions 147

OfficeHours

AUGUST 25, 2023

In particular, new guidelines from the FDIC and Federal Reserve (among other governmental agencies) made it more difficult for banks to underwrite financings that resulted in debt-to-EBITDA ratios in excess of 6.0x. This capital is released once investors buy the debt off the banks’ balance sheets.

Private Equity 130

Private Equity Equities Debt Finance 130

OfficeHours

JUNE 30, 2023

To go from equity value to enterprise value, add the net debt (debt minus cash) of the company to equity value. Step 3: Calculate Debt and Equity Funding Amounts (Sources & Uses) Since LBOs are financed using a combination of debt and equity, you’ll need to determine how much of each will be used in the transaction.

Private Equity 130

Private Equity Equities Debt Recruitment 130

OfficeHours

OCTOBER 20, 2023

Inflation can also have an impact on the cost of debt required to finance an investment. Inflation itself does not directly affect the cost of debt or interest; rather, since inflation and interest rates are very closely related, changes in inflation impact changes in interest rates. Great, I’m learning a ton!

Investors 130

Investors Private Equity Equities Debt 130

OfficeHours

JUNE 6, 2023

Leveraged buyouts involve acquiring a controlling interest in a mature company, typically through a combination of equity and debt financing, using the acquired company’s assets as collateral to secure debt financing. Private equity firms also invest in distressed debt or provide private debt financing.

Private Equity 147

Private Equity Equities Debt Investment 147

OfficeHours

OCTOBER 16, 2023

For the average person, rising interest rates are not ideal for those with significant amounts of debt, those looking to purchase a home with a mortgage, or many other use cases. Once the cash available is used to service the debt, whatever is left over is paid as dividends and used to calculate returns for private equity investors and LPs.

Investors 130

Investors Private Equity Debt Equities 130

RKJ Partners

AUGUST 6, 2017

In our latest blog installment, we define and outline the key elements involved in the process of raising capital. Strategy 5: Consider Subordinated Debt as an Alternative to Equity Most CFOs are familiar with the two financing products: senior debt and equity. Probably the most exotic of the instruments is subordinated debt.

Capital Raising 40

Capital Raising Capital Debt Finance 40

OfficeHours

JUNE 5, 2023

Balancing debt and equity components are crucial to minimizing the cost of capital while maintaining financial flexibility. In general, this focus on cash flow will enable timely debt servicing and can allow the acquired company to bounce back stronger than ever before being taken public or spun off to another private equity firm.

Private Equity 147

Private Equity Valuation Equities Debt 147

OfficeHours

OCTOBER 17, 2023

Existing Debt The US is a country riddled with debt. Others may have car payments, mortgages, credit card debt, or other debt that could hang over their head as a large liability. How are you liking these recent blog posts? Yes, I’m interested! No, I’m not Login or Subscribe to participate in polls.

Private Equity 130

Private Equity Debt M&A Investment 130

Cooley M&A

SEPTEMBER 25, 2020

In a May blog post we discussed several initial observations regarding the dozens of M&A transactions that were signed prior to March 2020 and that were in jeopardy as a result of COVID-19. In other words, the specific performance remedy is conditional, and neither buyer nor the sponsor can be forced to close without the debt financing.

Debt 40

Debt Finance Finance Private Equity 40

RKJ Partners

AUGUST 6, 2017

In our latest blog installment, we define and outline the key elements involved in valuing a target company. The method assumes leveraging, whereby the cash flow of the company is used to pay-off the debt—ultimately building equity. As a result, the value of the company lies in its ability to repay the debt. What is Valuation?

M&A 40

M&A Valuation Mergers and Acquisitions Discounted Cash Flow 40

Sun Acquisitions

APRIL 26, 2024

This blog post delves into the intricacies of different financing models, shedding light on the associated risks and rewards. Debt Financing: The Double-Edged Sword Debt financing is a standard route for companies pursuing M&A, offering the allure of leveraging existing assets to fund the transaction.

Mergers and Acquisitions 59

Mergers and Acquisitions Finance Finance Mergers 59

OfficeHours

OCTOBER 16, 2023

Inflation can also have an impact on the cost of debt required to finance an investment. Inflation itself does not directly affect the cost of debt or interest; rather, since inflation and interest rates are very closely related, changes in inflation impact changes in interest rates.

Investors 100

Investors Private Equity Debt Equities 100

Sun Acquisitions

NOVEMBER 1, 2024

This blog post will explore how technology is reshaping M&A activities and provide strategic insights on how businesses can prepare for successful mergers and acquisitions in a tech-driven world. Still, modern M&A must also evaluate the target company’s technology stack, cybersecurity posture, and data assets.

Mergers 59

Mergers Mergers and Acquisitions Business Acquisitions 59

OfficeHours

OCTOBER 23, 2023

Once the terms are agreed upon, the acquisition is financed through a combination of debt and equity from the PE firm , as with a typical transaction. This results in the target company receiving a potentially very different capital structure than they previously had, typically with higher debt levels. This will be helpful!

Investors 130

Investors Private Equity Equities Investment 130

OfficeHours

OCTOBER 16, 2023

Existing Debt : The US is a country riddled with debt. Others may have car payments, mortgages, credit card debt, or other debt that could be hanging over your head as a large liability. I personally have a lot of student loans which I factor into my monthly budgeting.

Debt 113

Debt Investment Healthcare Accountant 113

Sun Acquisitions

NOVEMBER 7, 2022

The long and short is yes, it’s possible, however, there’s a series of considerations from the Small Business Administration (SBA), the holder of your PPP loan debt that you need to comply with. You want to be free of this debt as soon as possible. Perhaps you’ve asked, “Can I sell my business if I got a PPP loan?”.

Business 98

Business Mergers and Acquisitions Sale Debt 98

OfficeHours

JULY 4, 2023

Getting someone to listen Read More Blogs Visit OfficeHours Blog and follow us on our social media accounts: Instagram , YouTube , TikTok , and Twitter for our latest updates. I’m Good On The Prep, I Just Need Help Getting Interviews” Interviewing is part art, part science.

Sale 130

Sale Private Equity Recruitment Equities 130

OfficeHours

OCTOBER 16, 2023

Once the terms are agreed upon, the acquisition is financed through a combination of debt and equity from the PE firm, as with a typical transaction. This results in the target company receiving a potentially very different capital structure than they previously had, typically with higher debt levels.

Investors 100

Investors Private Equity Equities Debt 100

Sun Acquisitions

MARCH 15, 2024

This blog post will explore why all-cash proposals are gaining traction and how they set themselves apart from other acquisition methods. Avoiding Debt Burden One of the critical advantages of all-cash offers is that they allow you to acquire a business without taking on additional debt.

Acquisitions 59

Acquisitions Business Negotiation Debt 59

Sun Acquisitions

FEBRUARY 14, 2024

In such cases, evaluating the financial health of target companies and understanding their debt structures is crucial. While it provides capital without the burden of debt repayment, it dilutes ownership and may involve relinquishing some control. Debt Financing: Debt financing involves borrowing money to fund your acquisition.

Acquisitions 59

Acquisitions Business Debt Finance 59