From everyday questions to specialized queries, IDNLearn.com has the answers. Ask any question and receive timely, accurate responses from our dedicated community of experts.

You have a company with 3x senior leverage and 5x junior leverage, what happens when you sell a business for 9x ebitda?

Sagot :

It's a de-leveraging transaction because pro-forma the company will have a lower total debt to EBITDA ratio.

On a firm basis, it has a neutral impact, but it is de-leveraging on a senior debt basis.

What is EBITDA leverage?

The debt to EBITDA ratio is a leverage metric that measures the amount of income that is available to pay down debt before covering interest, taxes, depreciation, and amortization expenses.

Is a higher or lower EBITDA better?

The total EBITDA margin will be around 10%. The EBITDA margin shows how much operating expenses are eating into a company's gross profit. In the end, the higher the EBITDA margin, the less risky a company is considered financially.

Learn  more about this here:

https://brainly.com/question/19578943

#SPJ4