Financing a $30 Million Dollar Acquisition

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by a searcher
in Atlanta, GA, USA

3yrs ago

Financing a $30 Million Dollar Acquisition

An opportunity came up through a family friend to purchase their business for $30 million dollars. How would you all recommend financing a deal of this size? Some stats about the deal below.

Purchase price: $30 million (5x EBITDA)
EBITDA: $6 million
Seller is willing to roll 30% equity + a 20% sellers note
I am not in the position to inject a significant amount of equity into the deal.

All input appreciated.

1 Like

229 Views

reply by a professional 3yrs ago
from University of Akron in Charlotte, NC, USA

We work with clients on the buy-side and have access to a large investor group (nearly 1k) that would be ideal for this transaction. They review deals up to $100 mm and will go higher with more a more detailed proposal. Each investor is well-funded and they all review the deal separately. It's not 1 investment decision but rather each individual investor decides independently whether they want to fund the transaction so just this one network we work with would expose your deal to nearly 1k active investors (60% of the deals on average are getting funded). Typically, they can fund 100% of the deal for 10-30% equity or they can structure their investment as debt as well. you can reach me at redacted if you want to learn more.

reply by a searcher 3yrs ago
from New York University in Connecticut, USA

At that size Ebitda you should be able to get leverage financing especially those who can provide both debt and equity given you are not able to put in equity. Assuming the family hasn’t done any 3rd party prepared financial statements, I would suggest hiring a accountant/ firm to do a review of the financials and/or QoE. This will help with levered providers.