Latest / The Buyout Show with Fexingo: Private Equity, Roll-Ups, and Business Acquisitions
The Car Wash Roll-Up That Cost PEs Billions
Episode 4 of The Buyout Show examines the spectacular collapse of Mister Car Wash's roll-up model during the 2022-2023 interest rate shock. Lucas and Luna unpack how cheap debt fueled a $4 billion acquisition spree, only to see valuations crash 60% when the Fed hiked rates. They trace the entire arc: why car washes seemed like the perfect recession-proof PE asset, how roll-up math works when leverage is cheap, and what happens when the music stops. Key numbers: $1.2 billion of goodwill on the books, EBITDA coverage ratios that fell below 1.0x, and a 2024 covenant waiver negotiation that…
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