Structuring

Designing the right deal structure is the most important part of the process. Most people don't adequately assess all of their options before deciding on a deal structure. We often see a company build their structure around incomplete knowledge. This can lead to an inferior or reactive structure. The keys to developing the best structure include understanding the following:

• The different types of capital available- this includes bank debt, mezzanine debt and private equity.
• What each capital provider is looking for - how far they will go, how much risk assumed, and expected pricing.
• The flexibility of each layer.
• How the layers of capital can work independently or in concert.
• How the purchase price and EBITDA affects structuring possibilities.

Our understanding of these elements allows us to design a unique structure for each client. Through creating the structure, we proactively design value for our client into the deal. Typically, the group first to devise the structure can arrange it to their benefit. Often, the structure is dictated by the capital provider which allows them to extract more value. Without knowing the ins and outs of structure, companies can often leave value on the table. Historically, our structures have allowed our clients to raise more money at lower prices than they thought possible. Often, our clients can raise acquisition financing through giving up only small equity warrants.