Sources & uses question
Assumptions:
Entry multiple: 8.0x
EBTIDA: 40m
Debt: 60m
Non-controlling interest: 10m
Unfunded pension liabilities: 10m
New debt: 160m
What is the required equity contribution?
Please create a sources & uses table and assume you roll over pension liabilities.
Follow-up: If the shareholder/founder wants to roll over a 20% stake, what would be his equity value pro forma for the transaction? In this case, what is the required equity cheque by the existing shareholder/founder?
I would do it like this
Uses Acquisition (Cash-free, debt free) = 320
Sources New Debt = 160 UPL Roll-over = 10 NCI Roll-over = 10 New Equity = 140
Pro-forma for the transaction (assuming the founder invests at your same valuation), his equity ticket would be 20%*140=28
Sorry forgot to mention that the company has cash on balance sheet of 20m as well.
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