1 / 7

2002 Capital Update

2002 Capital Update. Buying and Selling a Company in a Tough Economy. July 17, 2002 Anderson School at UCLA Los Angeles, CA. Debt Structure and Funding. Typical Capital Structure: EBITDA $ 25 million Purchase price - 7 times EBITDA $175 million

madonna-finley
Download Presentation

2002 Capital Update

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. 2002 Capital Update Buying and Selling a Company in a Tough Economy July 17, 2002 Anderson School at UCLA Los Angeles, CA

  2. Debt Structure and Funding Typical Capital Structure: EBITDA $ 25 million Purchase price - 7 times EBITDA $175 million ABL or Cash Flow Financing $ 50 million Tranche B Lenders $ 25 million Equity or Mezzanine $100 million

  3. Debt Structure & Funding • Lack of access to senior debt on a cash flow basis. • Cash flow lenders are offering 2 to 3 times EBITDA. • Sellers seeking 6 to 8 times EBITDA. • ABL lenders: Aggressively offering financing • Often financing ends up at 2-3 times EBITDA. • Financial sponsors are forced to invest 4-6 times EBITDA

  4. Capital Summary Senior Debt Leverage is Down Senior Debt Pricing is Up Equity Investments are Up High Yield Market is Red Hot Distressed Debt Market is Red Hot Due Diligence is Critical

  5. Presented By: Vicky Balmot Executive Vice President Congress Financial Corporation a Wachovia Company 626-304-4972 email: vbalmot@congressfinancial.com

More Related