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Please show step by step calculations Case . Consider a privately owned engineering business, of which the owner wants to sell 70% to a comparable,
Please show step by step calculations
Case . Consider a privately owned engineering business, of which the owner wants to sell 70% to a comparable, but larger business. Assume that Corporate Finance specialists suggested that this business is reasonably valued at a 6.3x EV/EBITDA multiple (Enterprise Value = 6.3x EBITDA). Furthermore, the business is expected to generate a projected EBITDA of 1.8m. The business has cash and cash equivalents of 1.2m and gross financial debt of 3.9m. The business does not have any minority interest holders nor any specific provisions, for example, provisions for litigation or environmental clean-up costs. Calculate how much the buyer needs to transfer to the seller for the desired equity stakeStep by Step Solution
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