Implied valuation of deal

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Reference no: EM13657151

The company

- Fee-only wealth management firm
- $100 million assets under management end 2013
- Grow assets under management by 15%
- Management fee of 75 basis points
- 30% EBITDA margins
- Exclusions: no depreciation, no amortization, no debt

Transaction

- Owner has 100% of the company, to retire end 2013
- Sell a minority stake to partner
- 30% sold from owner to partner
- Partner will pay $300,000 cash
- Balance of deal -> seller-financed note of $600,000. Seven year, straight line amortization and 5% interest rate

Task

- Overview of deal -> implied valuation of deal, annual cash flows to and from each party (include assumptions)

Reference no: EM13657151

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