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Links Capital's Perspectives | EBITDA Normalization

EBITDA Multiples | February 2022

Using EBITDA multiples is just one of many methodologies valuation experts consider when they value positive cash flow businesses. Whether EBITDA multiples are based off the trailing 12 months (TTM) EBITDA or the forecasted EBITDA, this approach has been widely used to value both private and public companies

Links Capital's Perspectives | EBITDA Normalization

EBITDA Normalizations | October 2021

As discussed in a previous newsletter, EBITDA is a widely used proxy for the cash flow of a business and as a valuation metric for comparing businesses. Non-cash items such as depreciation/amortization, along with income statement expenses of interest and corporate taxes, are added back to net income to arrive at EBITDA.

Links Capital's Perspectives | EBITDA and Business Valuation | April 2021

Links Capital’s Perspectives | EBITDA and Business Valuation | April 2021

EBITDA stands for Earnings Before Interest, Taxes, Depreciation and Amortization, it is a widely used proxy for a business’s cash flow and when multiplied by EBITDA market multiple, can determine the market valuation of a business.

Using EBITDA for valuation purposes, non-cash income statement items such as depreciation/amortization, along with interest expenses and corporate taxes, are added back to the net income to calculate EBITDA. EBITDA allows for the comparison of companies without the concern of different types of capital structures (lower versus higher levels of debt), differing tax rates or varying depreciation schedules on capital assets.

Links Capital's Perspectives | Preparing Your Business to Sell | January 2021

Preparing Your Business to Sell | January 2021

1 Page Template- Transaction Planning

When shareholders decide to sell their company, they must have a strong understanding of the transaction process and how their company should be positioned. This is a process that occurs over time working with experienced advisors. As a company evolves, it is important to understand how changes impact operations and more importantly what effect these changes will have on the valuation of the business. At Links, we address key areas shareholders should consider when evaluating and positioning a company for a monetization event while being cognizant that purchasers want to see the company continue to generate and grow earnings. Addressed in this newsletter are some select areas that shareholders should focus on.

Links Capital's Perspectives | Communicating with your Bank | October 2020

Links Capital’s Perspectives | Communicating with your Bank | October 2020

Almost every business at one time or another enters into a banking relationship where they have a line of credit or some kind of term financing with banks. From a cost of capital perspective, debt is the least expensive capital that one can attain and should use appropriate amounts of leverage in running their business. Banks are an important partner in the growth of any successful business and must be treated that way.

Links Capital Partners Ltd. advised the shareholders of Canfer Rolling Mills Ltd. on all aspects of the structuring and the negotiation of the divestiture of 100% of the shares to Tarpon Energy Services Ltd.

Canfer Rolling Mills Ltd. founded in 1994 is one the premier suppliers of pre-engineered buildings in Western Canada, operating out of 125,000 sq ft facility in Calgary, Alberta. Canfer Rolling Mills Ltd. also provides turnkey skid and modular buildings.

Tarpon Energy Services Ltd. founded in 2003 in Calgary, Alberta manufactures electronic products and services. The Company provides electrical and instrumentation, control systems, and steel building solutions as well as offers design and engineering, project management, construction, commissioning, and maintenance. Tarpon Energy Services operates worldwide.

Links Capital Partners Ltd. advised the shareholders of Nascor Ltd. on all aspects of the structuring and the negotiation of the divestiture of 100% of the shares to Arcticor Structures, a Calgary, Alberta

Nascor Ltd. was founded in 1982 and is Alberta’s largest manufacturer and distributor of engineered wood products including; I-Joists, roof truss and fixed/modular wall systems. A 77,000 sq ft facility in Calgary, Alberta and 30,000 sq ft facility in Edmonton Alberta. Nascor Ltd. also licenses out their I-Joist technology to licensees in Canada and the US.

Arcticor Structures, is a consolidator of Western Canadian businesses focused on the modular building and engineered wood products industries, addressing a manufacturing gap in temporary and permanent structures.

Links Capital Partners Ltd. advised the shareholders of AJ Industries Ltd. on all aspects of the structuring and the negotiation of the divestiture of 100% shares to Seaboard International a portfolio investment of the private equity firm Industrial Growth Partners.

AJ Industries Ltd. was founded in 1997 with the head office in Calgary, Alberta and service/distribution centers located in Edmonton, Red Deer, Lloydminister, Bonnyville, Brooks and Grand Prairie. AJ Industries Inc. is a value-added reseller and distributor of wellhead solutions and new/used piping solutions, along with the installation and rental of these products.

Seaboard International is a leading manufacturer of surface wellhead equipment for the onshore and offshore oil & gas markets. Industrial Growth Partners is a San Francisco-based specialist private investment partnership focused exclusively on acquiring middle-market industrial manufacturing and niche services businesses.

Links Capital Partners Ltd. advised the shareholders of Tiger Calcium Services Inc. on all aspects of the structuring and the negotiation of the acquisition of 100% of the shares of Tiger Calcium Services Inc. and the divestiture of shares in Keg River Chemical Corp.

Founded in 1964 as Tiger Chemicals, Tiger Calcium Services Inc. is a full-service provider and leader of calcium chloride products with a head office and logistics located in Nisku, Alberta and a production facility in the Mitsue Industrial Park, near Slave Lake, Alberta.

Keg River Chemical Corp is a manufacturer supplier of premium bentonite sulfur fertilizers to North America’s largest line suppliers and an extensive network of independent retailers – across the Western USA, Midwest, Western Canada and Quebec.

Links Capital Partners Ltd. advised the shareholders of the Tiger Calcium Services Inc. on all aspects of the structuring and the negotiation of the divestiture resulting in a majority share sale of the company to Tricor Pacific Capital (now Parallel49 Equity).

Founded in 1964 as Tiger Chemicals, Tiger Calcium Services Inc. is a full-service provider and leader of calcium chloride products with a head office and logistics located in Nisku, Alberta and a production facility in the Mitsue Industrial Park, near Slave Lake, Alberta.

Parallel49 Equity is a leading private equity firm that invests in profitable, well-managed, lower middle-market companies in the U.S. and Canada. Since its founding in 1996, the firm and its predecessor have managed over C$1.2 billion of investor capital.

Links Capital Partners Ltd. advised the shareholders of the Tiger Calcium Services Inc. on all aspects of the structuring and the negotiation of the divestiture resulting in a majority share sale of the company to Tricor Pacific Capital (now Parallel49 Equity).

Founded in 1964 as Tiger Chemicals, Tiger Calcium Services Inc. is a full-service provider and leader of calcium chloride products with a head office and logistics located in Nisku, Alberta and a production facility in the Mitsue Industrial Park, near Slave Lake, Alberta.

Parallel49 Equity is a leading private equity firm that invests in profitable, well-managed, lower middle-market companies in the U.S. and Canada. Since its founding in 1996, the firm and its predecessor have managed over C$1.2 billion of investor capital.

Links Capital Partners Ltd. advised the shareholders of the Can-Cell Group of Companies on all aspects of the structuring and the negotiation of the divestiture resulting in a 100% share sale of the company to Soprema.

Founded in 1976, the Can-Cell Group of Companies is a vertically integrated manufacturer / distributor of cellulose-based insulation and distributor of building materials and builders’ hardware products and includes Can-Cell Industries Inc., CCI Manufacturing Inc., Allied Paper Savers Inc. and Celufibre Industries Inc. with an Edmonton-based Corporate Head Office it operates both a manufacturing and recycling facility, six distribution centres and two cross-dock partner facilities.

Soprema is an international manufacturer specializing in the production of innovative products for waterproofing, insulation, soundproofing and vegetated solutions for the roofing, building envelope and civil engineering sectors. Founded in 1908 in Strasbourg, France, SOPREMA now operates in over 90 countries.