Latest / The Acquisition Talk with Fexingo: Mergers, Buyouts, and Business Sales for Operators
How the Earnout Fraud Trap Costs Sellers Millions
Lucas and Luna dissect a real 2023 earnout fraud case where a buyer manipulated EBITDA post-close to zero out a $15 million earnout. They walk through the accounting red flags—channel stuffing, capitalized maintenance, related-party scheme—and the three antifraud provisions every seller needs in their agreement. Specific case: a $50 million industrial components deal that ended in litigation. Listeners learn exactly how to spot a bad-faith earnout structure before signing.
#EarnoutFraud #MergersAndAcquisitions #MiddleMarketM&A #EBITDAManipulation #DealStructuring #BuyerBadFaith…
The skinny
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