| EBITDA | 5.8X |
| Senior Debt | 2.8X |
| Total Leverage | 3.7X |
Why Deals Don’t Close
Why Deals Don’t Close
By Tom Zucker, EdgePoint Capital Advisors
After working decades to develop your business and career, you finally arrive at the decision to sell the business. You’ve done a fantastic job identifying the buyer and negotiating the price and other sale terms. You’re relieved and satisfied, and can see the “closing” within a short 90 days, and the approaching transition to what comes next.
Capital Gains Taxes - Paying Uncle Sam Less
Capital Gains Taxes - Paying Uncle Sam Less
By Russ Warren and Tom Zucker, EdgePoint Capital Advisors
M&A activity has returned after taking a breather during the recent economic downturn, and it’s a seller’s market. Private equity and strategic acquirers alike are deploying cash to acquire middle market businesses at attractive multiples of healthy earnings. Yet, “it’s not what you sell for, but how much you take home after tax, that counts”. So, in addition to a market-based valuation of your business, it is worthwhile to have your tax advisor calculate the expected tax bite when planning a liquidity transaction. The key tax rate is that on long-term capital gains (LTCG) – the difference between basis and proceeds.
Window of Opportunity - Paying Uncle Sam Less When You Sell Your Business
Window of Opportunity - Paying Uncle Sam Less When You Sell Your Business
By Russ Warren and Tom Zucker, EdgePoint Capital Advisors
At 15%, today's maximum long-term capital gains tax rate (LTCG) is the lowest it has been in the last 75 years (see chart below). In 2003, this rate was reduced to 15% from 20%, with a sunset provision, and is effective through 2010.
If Congress and the Administration were to do nothing, the LTCG rate would go back to 20% on January 1, 2011.
One Buyer is No Buyer
One Buyer is No Buyer
By Russ Warren, Senior Vice President of EdgePoint
An unsolicited offer for millions of dollars has you and your spouse thinking about the life after business ownership. The offer is compelling, the buyer is credible and the buyer appears to be a good fit with your existing management team. So why are your key advisors telling you to wait? They keep telling you that "One Buyer is No Buyer".
Buyers' Hidden Risks
Buyers Hidden Risks
By Tom Zucker, EdgePoint Capital Advisors
The buyer has spent years searching for the near perfect company. The Corporate pressures for growth through acquisition have become intense. The seller and their counsel are pushing for a rapid close. Banks, accountants, and other advisors are creating constant roadblocks to a simple close. With all of these pressures it is easy to understand why a buyer overlook the many risks that they run in successfully buying a company.
Know When to Hold 'em, Know When to Fold 'em
Know When to Hold 'em, Know When to Fold 'em
By Russ Warren and Tom Zucker, EdgePoint Capital Advisors
Success at the poker table depends on understanding the relative strength of the cards you hold and acting smartly - knowing when to walk away a winner. As Kenny Rogers' song says, know when to hold 'em, know when to fold 'em.
Deciding when to sell a business depends on the same reasoning: facing what noted business author Jim Collins calls, 'the brutal facts of where you're at.'
Mergers and Acquisitions: What lever do I pull?
M&A: What Lever Do I Pull?
By Tom Zucker, EdgePoint Capital Advisors
