"$20m debt but the new purchase will generate $8 EBITIA (sic)...

"$20m debt but the new purchase will generate $8 EBITIA (sic) per year which means it pays for itself in 2 years."

pretty rubbery with your figures there SB2000. from my reading consideration is actually $25,000,000.

As this is funded entirely by debt the interest charge will be nothing to sneeze at. What rate will tox get for the debt?? Say 10% - thats an interest cost of $2,500,000 in the first year.

Further from the sound of it, its a very capital intensive business so you would expect depreciation expenses to be significant.

Clearly its going to take significantly longer than 2 years to pay off.

Just following tox at the moment. Its seems it has a pretty significant premium to its earnings multiple.

Personally cant see the S/P going anywhere near $4 in the short term given the current climate.

Does anyone know the debt structure. Is this going to leverage up the balance sheet. Unhealthy leverage in this environments is absolutely toxic.