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mrstaker1518
mrstaker1518
30.01.2020 • 
Business

Acme industries, inc. is a family business founded by wile

e. coyote. acme had $20 million in ebitda last year and no debt. businesses of this size are currently valued at 4.5x. mr. coyote wants to unlock some of his enterprise value by doing an equity recap. he wants to take out as much cash as possible while retaining 35% ownership in his company. the current credit markets will tolerate senior debt of 2.5x and 1.5x of mezzanine debt. the mezzanine lenders demand warrants that would represent a 5% equity stake. a private equity group called peg capital has agreed to do the deal.

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