The Working Capital True-Up That Cost a Seller $2 Million

The Acquisition Talk with Fexingo: Mergers, Buyouts, and Business Sales for Operators · Jul 5, 2026 · 11m · transcript

Lucas and Luna dissect a real-world M&A disaster where a seller lost $2 million from their payout because of a poorly negotiated working capital true-up mechanism. They walk through what working capital targets are, how the closing true-up works, and the specific pitfalls that trip up sellers: stale balance sheets, excluded items like deferred revenue, and the infamous 'normalizing adjustments' that buyers use to retroactively shrink the target. They use a concrete example: a SaaS company with $8 million in revenue, $1.2 million in net working capital at signing, but a $900,000…