Latest / The Acquisition Talk with Fexingo: Mergers, Buyouts, and Business Sales for Operators
The M&A Working Capital Peg That Cost a Seller $6 Million
In this episode, Lucas and Luna dissect a surprisingly expensive M&A artifact: the working capital peg. Using the real-world case of a mid-market industrial distributor that sold for $120 million, they walk through how a $2 million miscalculation in the working capital target — triggered by a seasonal spike in receivables — cost the seller $6 million at closing. They explain what the working capital peg is, how buyers and sellers negotiate it, and why a poorly timed closing date can shift millions in purchase price. Lucas offers practical tips: audit the trailing twelve months, carve out…
The skinny
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