EBITDA multiple for roll-up

Take the two businesses single valuations and add them together. If you think the valuation should be higher because of of synergies (ie eliminating some management), then take the synergies "separately" and put a multiple on those, showing the "upside" value from the synergies separately to the financing parties. You can debate with the financing entities what multiple there should be on synergies. If you think the combined business should have a higher multiple because it is larger and will grow faster, then you will need a third party (ie investment bank) to come up with a list of comparable transactions at the larger size which shows that the business should get a higher multiple because it is larger. If you have that proof, then it is easier to argue a valuation uplift because of size or diversification.

Following...