Real case: an industrial maintenance company in Zaragoza. Started at a €4-5M valuation and closed at €41M. Month by month, here's what changed.
In October 2024 Luis Martínez called us for the first time. He owned an industrial maintenance business in Zaragoza, 24 years of operation, €8.4M in revenue and €1.2M EBITDA. He wanted to sell in six months and retire. The first valuation he had received from a local adviser was €4-5M. Eighteen months later, the deal closed at €41M with a German industrial fund. This is what happened in between, step by step, because no M&A textbook tells it like this.
The initial diagnosis: four problems worth millions
When we reviewed Luis's business, we found the usual story in mature family-owned companies. The business was good — better than good, actually — but it was poorly packaged for a transaction. Four specific issues:
Reported EBITDA was not real EBITDA. Luis and his son drew €320,000 and €240,000 respectively, well above the €90-110K market rate for their roles. The company paid €12,000/month rent for a warehouse he personally owned, when the comparable was €7,500. There were two premium cars and a sports boat on the books. Total legitimate add-backs: €480,000. Normalized EBITDA: €1.68M, not €1.2M.
The customer portfolio looked concentrated but wasn't. The largest client represented 31% of revenue. Bad data at first glance. But when we broke it down, that "client" was 14 different plants in the same group, each with its own procurement lead, contract and cost center. Real concentration at the level of the actual decision-maker: 8%.
Contracts weren't accounted for as assets. Luis had 47 annual maintenance contracts on tacit renewal, in force for 6-15 years. That's contractual backlog of roughly €5.2M of guaranteed annual revenue. It appeared nowhere in his commercial materials.
The structure couldn't support larger growth. The whole company depended operationally on Luis and his site supervisor. Any serious buyer would see that as risk and discount the multiple accordingly.
Months 1-3: fix what could be fixed in 90 days
The first quarter we worked three fronts in parallel, without touching the operating business.
On the financial side, we rebuilt the P&L for the last four years in normalized format. We documented each adjustment with its invoice, market comparable and justification. We built a support binder the buyer could replicate line by line — that binder is your only defense when the buyer comes haggling in due diligence.
On the organizational side, we hired a senior operations director (90 days of search, €78K annualized cost). The goal wasn't to save Luis hours, it was to tell the buyer "this company keeps running even if Luis leaves tomorrow." That change adds between 0.8x and 1.5x EBITDA to the multiple depending on the buyer.
On the commercial side, we reorganized the customer database with the real concentration analysis, contracts in force with duration, the last 5 years of renewals (98.3%, a spectacular number nobody had written down), and the share of wallet at the largest client broken down by plant. This work took five weeks but lifted perceived asset quality by 40%.
Months 4-6: build the IM and open the process
Homework done, we prepared the Information Memorandum. 42 pages, not 120. A one-page executive summary opening with three numbers: €1.68M normalized EBITDA, €5.2M of contractual recurring revenue, 98.3% renewal rate. Everything else in the document served to support those three numbers.
The narrative angle we chose carefully. Luis's company wasn't sold as "industrial maintenance in Aragón." It was sold as "specialized operator in chemical and pharmaceutical sectors with 98% retention rate and entry barriers via ATEX and APQ certifications." Same business, but framed in a way a private equity fund could build a sector roll-up thesis on top of.
We built the buyer list in two blocks. On one side, 14 strategic players in the sector (direct competitors and adjacent firms that had been trying to enter chemical-pharmaceutical for a while). On the other, 23 private equity funds with industrial services theses in Southern Europe. Total 37 contacts. After initial filtering and NDAs, 19 active processes remained.
Months 7-9: the non-binding offers and why the first one was a trap
Of the 19 processes, 11 sent non-binding offers. The range was very wide: €4.2M to €22M. The first binding-style offer to land was €14M — a Spanish strategic who knew the sector well and wanted to move first.
This is where the critical moment happened. Luis wanted to accept. It was already three times what they had valued the business at initially, his age was weighing on him, and the idea of carrying on for six more months was exhausting. We spent three hours explaining why that offer was a trap.
The strategic offered €14M but with three conditions: 30% in earn-out over three years tied to EBITDA, 100% key team retention for two years, and 90-day exclusivity from LOI signing. Translation: the buyer wanted to lock the asset for three months with no competition, condition €4.2M of the price on targets they would control as the new owner, and tie Luis to the company for two more years precisely when he wanted to retire. Effective price, risk-adjusted, was closer to €9.5M.
We asked Luis for two more weeks of process. He said yes. That decision was worth €31.5 million.
Months 10-12: the closed auction and the German offer
With 8 offers in the €12-22M range, we organized a closed auction among the top five bidders. Single deadline, sealed envelopes, public criteria: total price, percentage in cash at close, earn-out conditions, retention requirements. No improvements after submission.
The winner was a German fund with a portfolio of industrial businesses across six European countries. Their offer: €41M with €36M cash at close, €5M earn-out over two years on realistic EBITDA targets (base plan was €1.8M and the earn-out target was €2.1M), Luis retained only as strategic adviser for 6 months, and no aggressive locked box.
The multiple: 24.4x normalized EBITDA. Above the sector range but justifiable by the three investment theses we'd built into the IM: integration with their industrial services platform in Italy and France, geographic expansion into Catalonia and Levante leveraging their sales network, and entry into pharmaceutical certifications they didn't have.
What we learned from the process
The difference between €4M and €41M wasn't in the business. Luis was the same, the customers were the same, real EBITDA was almost the same. The difference came from three cumulative decisions: normalize EBITDA correctly and document it, build the investment narrative a fund can sell to its committee, and resist the pressure to accept the first reasonable offer.
That's what a well-managed M&A process looks like. No magic. Methodical work over 18 months with an adviser who understands how the other side of the table thinks.
