Auto Aftermarket Representation & Warranty Insurance: An Independent Sponsor's Counsel
Independent sponsor counsel for auto aftermarket, focused on Representation & Warranty Insurance and the deal mechanics that protect sponsor economics and LP alignment.
An independent sponsor closing auto aftermarket transactions in the $8M to $90M EV range has a defined set of moves at the Representation & Warranty Insurance stage. Most of them are not in a generic M&A textbook.
The typical auto aftermarket platform sits at $8M to $90M EV with EBITDA in the $2M to $16M range. The thesis runs on service-center or specialty-shop regional roll-ups. Technician shortage is the single biggest valuation risk. Underwrite the bench, not the bays.
How Representation & Warranty Insurance actually gets structured.
Get to non-binding indication within two weeks of LOI sign, with carrier diligence to follow.
Negotiate retention to 0.5 percent of EV, dropping to 0.25 percent after 12 months.
Confirm policy follows form on the purchase agreement, not the other way around.
Carve out tax indemnities and known liabilities, priced separately if needed.
In auto aftermarket, layer in technician retention pool defined and funded as part of the Representation & Warranty Insurance workstream.
Treating R&W as a commodity. Carrier appetite varies sharply by industry and deal size.
"R&W is no longer optional on most independent sponsor deals over $20M. Price it into the LOI."Jason Powell · Representation & Warranty Insurance
The deal is one thing. The capital that opens up after close is another.
Refinancing, recaps, growth rounds, and the right strategic conversation eighteen months early are all downstream of relationships that take years to build and minutes to use.
Related deal pages.
Transaction Fee Structuring for Auto Aftermarket
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Working Capital Adjustments for Auto Aftermarket
The closing-date true-up that protects the buyer from receiving a business stripped of normal-course working …
Indemnification for Auto Aftermarket
The seller's contractual promise to compensate the buyer for breaches of representations, covenants, and spec…
Quality of Earnings for Auto Aftermarket
The buyer's accounting diligence report normalizing earnings, working capital, and pro-forma performance.
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An LOI on the desk, a auto aftermarket target, and a Representation & Warranty Insurance question worth a real conversation.
Twenty minutes of practitioner-grade input from a securities attorney whose first move is to read the deal, not the engagement letter.