The formula to calculate EBITDA Multiple is:
\[ \text{Enterprise value} = \text{Market capitalization} + \text{Value of debt} + \text{Minority interest} \]
\[ + \text{Preferred shares} - \text{Cash and cash equivalents} \]
\[ \text{EBITDA multiple} = \frac{\text{Enterprise value}}{\text{EBITDA}} \]
EBITDA multiple is a financial metric that helps to determine the value of a company. It is calculated by dividing the enterprise value by EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization). The enterprise value represents the market value of a company, including its debt and excluding its cash and cash equivalents.
Let's assume the following:
To calculate the Enterprise Value:
\[ \text{Enterprise value} = 300,000 + 100,000 + 20,000 + 30,000 - 15,000 = 435,000 \]
To calculate the EBITDA Multiple:
\[ \text{EBITDA multiple} = \frac{435,000}{50,000} = 8.7 \]
Therefore, the EBITDA Multiple is 8.7.
