Food & Beverage Quality of Earnings: An Independent Sponsor's Counsel
Coordinating Quality of Earnings on food and beverage deals, with the structure protection and capital connectivity an independent sponsor actually needs.
Quality of Earnings on food and beverage deals is one of those workstreams that looks routine on a checklist and decides outcomes in practice.
The typical food and beverage platform sits at $10M to $120M EV with EBITDA in the $2M to $20M range. The thesis runs on CPG roll-up or co-packing platform with regional bolt-ons. Treat trade spend like a working capital item, not a marketing line. The valuation moves accordingly.
How Quality of Earnings actually gets structured.
Engage QofE within five business days of LOI signing.
Scope to include working capital normalization, deferred revenue, and customer concentration.
Share preliminary findings with the seller before final report, to surface disputes early.
Coordinate QofE findings into both the purchase agreement and the LP commitment package.
In food and beverage, layer in co-pack capacity agreement re-papered as part of the Quality of Earnings workstream.
Treating QofE as a back-office exercise. It is the basis for the price, the working capital peg, and the LP pitch.
"The QofE is the deal book. Read it twice before you negotiate anything."Jason Powell · Quality of Earnings
The deal is one thing. The capital that opens up after close is another.
Most independent sponsors solve the closing capital and then run into the post-close capital problem alone. The capital markets relationships that matter at month 18 are part of this practice.
Related deal pages.
Independent Sponsor Economics for Food & Beverage
The package of deal-by-deal carry, management fees, and transaction fees that compensates the independent spo…
Management Fee Structuring for Food & Beverage
The annual fee paid by the deal entity to the independent sponsor for ongoing oversight, board service, and p…
Transaction Fee Structuring for Food & Beverage
The fee paid at closing to the independent sponsor for sourcing, structuring, and closing the platform deal a…
Equity Rollover for Food & Beverage
The portion of seller proceeds reinvested into the post-close entity, aligning seller with buyer.
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Bring the food and beverage deal. Get Quality of Earnings 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.