
Gerry Williams
Purchase Agreement | M&A Attorney
The purchase agreement – getting it right from the beginning with the LOI helps a smooth closing. Gerry Williams, an M&A attorney, outlines a purchase agreement’s key components and four…
Mergers & Acquisitions – They say selling a business is an art – we’ve turned it into a science
Schedule a ConsultationKevin Moyer returns to M&A Talk to discuss EBITDA multiples, emphasizing their importance in valuing companies in the middle market. EBITDA multiples measure a company’s enterprise value against its current EBITDA or run rate, either as reported or adjusted, and can vary widely by industry. The discussion covers the role of CapEx, the importance of accurate EBITDA adjustments, the need to ensure that EBITDA multiples are based on recent, relevant transactions, and the significance of net working capital in purchase price calculations.
“You need to feel comfortable with the multiplies you are going to be using as your baseline. The last thing you want to do is miss widely.”
Kevin Moyer
What is an EBITDA multiple, and why are they so common? [1:42] | |
What is the most common mistake people make when using an EBITDA multiple? [6:25] | |
When is it not appropriate to use an EBITDA multiple? [11:10] | |
What is adjusted EBITDA, and why is it used? [15:03] | |
What is the correct number to multiply for EBITDA? [21:05] | |
What is the role of CapEx? [25:06] | |
What should be included in the purchase price when an EBITDA multiple is being used? [28:10] |
Kevin Moyer is a Director and the Midwest Business Development Leader in Bennett Thrasher’s Transaction Advisory Services (TAS) group, focusing on business development and relationship management. Kevin previously served as a Partner and TAS Practice Leader at SAX LLP, another top 100 public accounting firm. Kevin also has hands-on M&A experience working in corporate development at Paychex and on the investment team at the family office of Simon Group Holdings.
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