Understanding Net Working Capital (NWC) 101 - Beware of the NWC Trap!

Corp Dev World - Learn All About The World of Corporate Development | M&A | Mergers & Acquisitions

06-05-2023 • 17 mins

This podcast is a must-listen for entrepreneurs, investors, and finance professionals looking to sharpen their deal-making skills and gain a competitive edge in the world of business. Welcome to another episode of Corp Dev World with your host, Mubarak Shah, CPA! In this episode, we dive deep into the world of working capital and its crucial role in deal-making. Mubarak Shah, CPA, a seasoned business expert with a wealth of experience in mergers and acquisitions, provides valuable insights on how net working capital adjustments can significantly impact the purchase price of a transaction. Throughout the episode, we break down the importance of understanding working capital for both buyers and sellers, demystifying complex financial terms and concepts. You'll learn about the calculation of net working capital, the various components it comprises, and how to negotiate net working capital adjustments to protect your interests in a deal. Listen in as we share real-life examples and case studies, illustrating the strategic importance of working capital management and its effect on the valuation and success of a deal. This episode is sponsored by Mowery & Schoenfeld - a transaction advisory firm of elite deal M&A CPAs and accountants that have assisted in hundreds of Search Fund and Independent Sponsor deals to perform Quality of Earnings and walk you through the deal process. Reach out to us at either 516-417-4941 or mubarak@shahbusinesscpa.com if you have any questions as always! Learn more about your ad choices. Visit megaphone.fm/adchoices