<img src="https://d5nxst8fruw4z.cloudfront.net/atrk.gif?account=n/CSo1IWx810Y8" style="display:none" height="1" width="1" alt="">

Subscribe to Email Updates

Latest Blog Post

Business Valuation, Recapitalization, Selling Your Business

Debt Capital Market Update - Q3 2019

TKO Miller Debt Capital Market Analysis 

  • Leverage multiples remain at peak levels in M&A transactions due to an aggressive lending environment and the low cost of debt
  • Leverage multiples, as measured by Total Debt / EBITDA, increased from 3.9x in 2018 to 4.1x in 2019 (as depicted in the graph below)
  • Leverage conditions are expected to remain highly supportive over the next 9-12 months, but trade tariffs with China and Europe, a global economic slowdown, or uncertain political conditions are capable of shifting conditions back to lower, more historic levels
  • The aggressive growth initiatives for both strategic and financial buyers, and a greater ability to fund acquisitions will remain strong
  • The debt market is a key driver of M&A valuations; valuations will decrease when leverage multiples fall, and the cost of debt increases
  • Transactions are seeing decreased equity contributions in response to rising leverage multiples compared to 2018 levels (as depicted in the graph below)

Total Debt/EBITDA Multiples 

Steve Yahnke
By Steve Yahnke
on Oct 17, 2019 7:15:00 AM
   
Debt Capital Market Update - Q3 2019

TKO Miller Debt Capital Market Analysis 

  • Leverage multiples remain at peak levels in M&A transactions due to an aggressive...
Steve Yahnke
By Steve Yahnke
on Oct 17, 2019 7:15:00 AM
Debt Capital Market Update - Q2 2019

TKO Miller Debt Capital Market Analysis 

  • Leverage multiples remain at peak levels in M&A transactions due to an aggressive...
Steve Yahnke
By Steve Yahnke
on Aug 6, 2019 7:05:00 AM
Debt Capital Market Update - Q1 2019

TKO Miller Debt Capital Market Analysis 

  • Leverage multiples remain at peak levels in M&A transactions due to an aggressive...
Steve Yahnke
By Steve Yahnke
on Mar 27, 2019 7:05:00 AM
You Can Put Debt on Your Business and Pay Yourself a Dividend. Really.

I cannot believe how many business owners don't know this. Perhaps it's a function of being a merger and acquisitions...

Steve Yahnke
By Steve Yahnke
on Nov 1, 2018 7:35:00 AM
Debt Is Not a Dirty Word

Debt to a business owner can conjure up images of corporate raiders who coax a little unsuspecting firm into taking on way...

Tammie Miller
By Tammie Miller
on Dec 6, 2017 7:00:00 AM
Five Reasons Why An ESOP Might Not Be The Answer

It happens in cycles.  ESOPs move in and out of favor as an option for business owners desiring to move onto the next phase...

Tammie Miller
By Tammie Miller
on Jan 20, 2017 3:30:00 PM

Leave a comment

Written by
Written by Author