Specialty Chemicals Deals: Quality of Earnings Done Right
Independent sponsor counsel for specialty chemicals, focused on Quality of Earnings and the deal mechanics that protect sponsor economics and LP alignment.
Quality of Earnings on specialty chemicals deals is one of those workstreams that looks routine on a checklist and decides outcomes in practice.
The typical specialty chemicals platform sits at $15M to $200M EV with EBITDA in the $3M to $28M range. The thesis runs on niche formulator or contract manufacturing buy-up. The IP lives in the formulator's head as often as in the company. Structure for that risk explicitly.
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 specialty chemicals, layer in chemical inventory transfer filed 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 Specialty Chemicals
The package of deal-by-deal carry, management fees, and transaction fees that compensates the independent spo…
Management Fee Structuring for Specialty Chemicals
The annual fee paid by the deal entity to the independent sponsor for ongoing oversight, board service, and p…
Transaction Fee Structuring for Specialty Chemicals
The fee paid at closing to the independent sponsor for sourcing, structuring, and closing the platform deal a…
Equity Rollover for Specialty Chemicals
The portion of seller proceeds reinvested into the post-close entity, aligning seller with buyer.
Quality of Earnings for Healthcare Services
roll-up of physician practices and ancillary service lines
Quality of Earnings for Home Services
regional roll-ups of HVAC, plumbing, and electrical operators
Bring the specialty chemicals 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.