After 18 months on the search, I have signed an agreement to purchase what I believe to be a fantastic business on great terms. I have been involved in the transaction process of this business since July and so have had a solid amount of time to familiarise myself with the company and have put together extensive analysis which I’d be happy to share with potential investors. There has been a lot of excitement and interest from lenders and I’m now in the process of finalising a debt financing package of between 70 – 90% of the purchase price of £5.5M ($6.7M). Few snapshots: • Operates in the supported living and domiciliary care space • Original purchase price of £6M. Revised to £5.5M ($6.7M) • Owns property valued at £4.2M ($5.1M) • Latest Financial Year Turnover of £13M ($15.7M) • Latest Financial Year EBITDA of c. £1.5M ($1.8M) • Existing management committed to investing £250,000 in the new business as part of the acquisition. All management have between 15 and 20+ years of experience working with this business • £0.7M Equity Gap • Target raise of between £0.7M and £1.2M • Top end of raise allows the business to embark on a roll up strategy quicker The current owner is 80 years old (retirement sale) and has had no reason to be directly involved in running the business since purchase due to the high-quality management team in place. Three Regional Directors and the CFO have effectively been managing the finance and operations and all will be remaining post acquisition. Given the owner’s age and tax position he has expressed a strong preference towards all consideration being paid upfront, in lieu of an earn out or deferred consideration (although he would not dismiss this completely) – thus the discount. Happy to share the prepared IM, financial model, and latest industry report.
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