easy · Private Equity value-creation

A private equity firm is evaluating a 'Buy-and-Build' strategy. It acquires a platform for 10.0x EBITDA and then acquires three smaller add-ons for 6.0x EBITDA.

If the platform and add-ons are the same size, what is the blended entry multiple for the combined entity?

  1. 7.0x
  2. 10.0x
  3. 8.0x
  4. 6.0x

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