Buyer beware: For buyers under LOI in the middle of DD

by a searcher

11 months ago

For buyers under LOI in the middle of DD. Make sure you request updated financials on a monthly basis for the duration of DD. There could be a situation where the EOY EBITDA is significantly lower than the TTM you based the valuation/PP off of. I may or may not be speaking from experience.

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4 comments

searcher from IESE Business School

Not relevant if one uses a locked-box pricing mechanism

11 months ago | like reply | 0 likes

searcher from California State Polytechnic University - Pomona

In any event, a thorough quality of earnings should be run with up to date financials.

11 months ago | like reply | 1 like

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