Cybersecurity Services Deals: ERISA & Benefits Diligence Done Right
Securities and M&A counsel for independent sponsors diligencing cybersecurity services transactions, from LOI to close to the capital markets that open up afterward.
Cybersecurity Services deals in the lower middle market run a specific playbook. ERISA & Benefits Diligence is where the structure either holds or starts to leak.
The typical cybersecurity services platform sits at $10M to $130M EV with EBITDA in the $2.5M to $22M range. The thesis runs on MSSP or specialty consulting platform. Cleared workforce is the moat. Cleared workforce can also be the deal-killer in CFIUS reviews.
How ERISA & Benefits Diligence actually gets structured.
Pull the 5500s and audit reports for the last three years.
Identify any controlled-group exposure that follows the seller post-close.
Address multi-employer pension withdrawal liability where applicable.
Plan the benefits transition to the buyer's plans, with a TSA period if needed.
In cybersecurity services, layer in FSO succession plan in place as part of the ERISA & Benefits Diligence workstream.
Skipping the multi-employer pension review. It can show up as a 7-figure surprise three months post-close.
"ERISA is the silent deal-killer. Treat it like senior debt diligence."Jason Powell · ERISA & Benefits Diligence
The deal is one thing. The capital that opens up after close is another.
After close, the call list for refinancing, recapitalization, and growth equity gets short and known. Jason carries that list.
Related deal pages.
Independent Sponsor Economics for Cybersecurity Services
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Management Fee Structuring for Cybersecurity Services
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Transaction Fee Structuring for Cybersecurity Services
The fee paid at closing to the independent sponsor for sourcing, structuring, and closing the platform deal a…
Equity Rollover for Cybersecurity Services
The portion of seller proceeds reinvested into the post-close entity, aligning seller with buyer.
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Bring the cybersecurity services deal. Get ERISA & Benefits Diligence done right.
Direct counsel from a securities and M&A attorney with billions in structured transactions, the independent-sponsor-native playbook, and the capital markets network that opens up post-close.