Just as I hate it when my investee companies buy stuff from private equity, I love it when they buy from administrators, where the selling motivations are expediency over value optimisation.
If IVE can consummate this deal, it would mean it is spending 5% of its Market Cap in order to acquired 20% more Revenue
Viewed another way,
IVE's EBITDA margin is currently running at around 12% to 13%
Even if the Ovato assets end up delivering 10%; no, heck... let's make it 8%, it would mean EBITDA of around $12m.
So, an effective EV/EBITDA multiple of 1.3x (and if one applied some D&A assumptions based on industry norms, an EV/EBIT multiple of under 2.0x).
[Oh, please let the ACCC sign off on the transaction]
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Ann: Execution of Asset Sale Agreement to Acquire Ovato Assets, page-5
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