EBITDA Multiple Basic Question
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On the face of it I'd assume 8x EV. The capital structure of basic equity doesn't really equate to EBITDA.
an EBITDA multiple corresponds to a company's enterprise value
8x is the EV. back out the debt part of the capital structure to get to equity value.
Yea, I agree with the guys that posted above. At the risk of beating a dead horse. If they had preffered shares, and pensions as well, these should also be taken off the EV to get to common equity value
Acquisition multiples should always be EV.
Multiply ebitda by 8, this gives you the implied enterprise value of the transaction. Net out debt (net), minority interest, etc to arrive at equity value. Lol, dead horse.
EV/EBITDA, hence you'd be referring back to the enterprise value.
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