Consolidation strategy

June 20, 2020
by a searcher from Millersville University of Pennsylvania in Lancaster, PA, USA
I'm the Founder and Managing Director of DSC Solutions, a multi-state facility services company. We are currently under an exclusive LOI to acquire a competitor doing $7M per year in revenue for just over $1M. The company has the potential to produce an EBITA of at least $1M after our operational and administrative improvements. We've identified several other potential targets under similar circumstances.
The industry is very fragmented, presenting a very good opportunity to consolidate smaller firms and undergo an exit at a higher multiple of EBITA. Has anyone pursued a similar strategy? Any advise?
Thanks!
Alan
from Bentley University in Boston, MA, USA
from Missouri State University in Chicago, IL, USA