Why do you need valuation in recapitalization pitches?

Good explanation

"throed yung playa"

It sounds like you're confusing equity and debt recaps.

For an equity recap, the answer is pretty obvious. If I'm recapitalizing a company with my equity dollars, I want to know how much of the business I'm going to own after I've contributed my $$$. In order to determine that, I need to value the business.

On the other hand, if I'm an existing equity owner and I'm considering recapitalizing my business with some debt, I won't show detailed valuation metrics in presentations to prospective lenders. I will just show some basic leverage ratios that emphasize my ability to repay the amount of debt that I am requesting. Lenders will still consider EBITDA, though, as it is generally used as a proxy for operating cash flow in the mind of a lender. They like seeing that you have a level of EBITDA to support your fixed charges (to a lender, fixed charges generally mean ttm interest expense plus current maturities of long-term debt).

Thanks. Does this mean that you'd typically include a 1 pgr on valuation in debt refinancing pitches simply to have back pocket? Thinking simply due to potential for M&A during pitch if investor isn't a pure debt investor. Otherwise, are you saying for debt pitches you typically don't include ANY valuation pages at all?

Thanks