Hello all - trying to structure a deal, and could use some assistance thinking through financing and structure options. First time I've done a deal that came w/ real estate attached to an operating business. Not sure how to properly think through options...Here are the key points:
OpCo: - manufacturing company - Revenue: 50 M - EBITDA: 1.5 M - $5 M inventory - $5 M A/R - 3 owners (33% each) - 2 want to exit; 1 wants to roll 100% of proceeds
Real Estate - 3 buildings in North American (500k sq. ft. industrial) - estimated value 3 M for real estate on stand alone basis
Seller Valuation: 12 M
Current thinking is that if seller rolls ~$3M (post taxes), and we contribute additional $1 M for total $4M equity, then raise 8M debt. We will have a detailed plan to present to lenders where we believe we can get company to $4M EBITDA within 24 months, maybe 36 if we are slow to execute. Business has been under-managed.
Would appreciate any thoughts on how to structure. I feel like there is a way to use real estate as asset and either borrow less or put less equity in.
thoughts please.....
delete
Thanks Jack. Yes, we are thinking about this route. I'm not sure how to calculate this asset into the model. Also, trying to think through whether we do a sale/leaseback to close in conjunction with opco deal, or whether we should wait until we close then explore the sale/leaseback option.
Alias sint a et. Totam et ullam et cupiditate ratione perspiciatis consequuntur. Rerum nisi asperiores sunt vel tempore ex. Eum deserunt dolores magnam harum sint pariatur voluptatem. Odit distinctio nesciunt reiciendis. Enim quod nesciunt et.
Saepe neque voluptate rerum iusto voluptate dicta est quos. Quae odio enim illum autem odio quod est. Fugit alias hic eos rerum. Et odit velit totam ut voluptas nisi.
Nam voluptates fugiat ab et. Quas eos omnis saepe quia dolore. Unde esse et repellendus est.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...