EBITDA to Free Cash Flow in M&A: Formula, Bridge & Buyer Underwriting
A transaction-focused guide to bridging EBITDA into free cash flow, FCFF, levered cash flow, debt paydown capacity, valuation support, and buyer underwriting in middle-market M&A.
Quality of Earnings vs Normalized EBITDA in M&A Valuation
Quality of earnings and normalized EBITDA are critical steps in how buyers evaluate a company’s true earnings power during an M&A transaction. This guide explains how reported EBITDA is adjusted, tested through diligence, and used to support valuation multiples in middle-market deals.
Revenue Peg vs Working Capital Peg in M&A
A revenue peg and a working capital peg are two different mechanisms used to determine purchase price adjustments in M&A transactions. While working capital pegs are the standard approach in most middle-market deals, revenue pegs may be used in certain asset-light or recurring-revenue businesses. This guide explains how each method works, when buyers use them, and how they affect the bridge from enterprise value to final seller proceeds.
Debt-Like Items in M&A: How Enterprise Value Adjustments Affect Seller Proceeds
Debt-like items are liabilities that reduce seller proceeds in M&A transactions. Learn how enterprise value adjustments, net debt, and working capital determine the equity value paid at closing.
