To LOI or not to LOI, that's the question.

by a searcher from Canisius College

9 months ago

Hello Searchers and partners.

I received a CIM on a company that I find interesting.  The summary and background were informative, but the financial information was lacking.  I have asked the broker for a full TTM income statement and a breakdown of the SDE add backs and have not heard back.  My thought process is that if I can't get the deal to cash flow then what is the point of an LOI.  But I am wondering if perhaps I should have submitted an LOI to get the additional information.  

Thoughts or feedback would be greatly appreciated.

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17 comments

searcher from University of San Francisco

in my experience if you've signed an NDA to receive the CIM, a good broker who has done his/her job in prepping all of those docs should have no problem sending you additional info. I've received anonymized employee comp info, last three years of all financials, etc by asking for it.

9 months ago | like reply | 1 like

searcher from Canisius College

My initial thought was that I needed more information to determine if the deal would cash flow. Why bother expressing intent if I can't make the debt service work? But the IOI is a good idea as a step before an LOI so I will do that going forward. I appreciate you taking the time to respond to my post.

9 months ago | like reply | 0 likes

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