Expert Webcast: Best Practices for Emerging Independent Sponsors

LP Partner Robert Connolly joined co-panelists Alex Kasdan, Expert Webcast; Kurt Smentek, Align Collaborate; Patrick Stroth, Liberty Company Insurance Brokers; and Sylvie Gadant, Citrin Cooperman to discuss the emerging independent sponsor landscape and how best practices have evolved as this sector has matured.

This conversation addressed questions including:

• What’s driving the growth of the independent sponsor sector, and what does the M&A market look like these days?
• The average independent sponsor deal size has been going up over the past few years. Given that, what numbers now define the lower middle market?
• What do you look for in backing an independent sponsor?
• How has the risk mitigation and deal insurance approach evolved to address independent sponsor transactions in the lower middle market?
• What’s different about representing independent sponsors as opposed to private equity, and how do you get the deal to close?
• How do you source deals as an independent sponsor?
• In terms of sequencing, when do independent sponsors begin seeking capital from capital providers?
• When an independent sponsor is looking for capital, are they looking for equity first, debt, or both at the same time?
• In terms of risk transfer, how do underwriters evaluate independent sponsors?
• What is the ideal level of detail to include in the LOI?
• What is the best way to mitigate broken deal costs?
• Does it matter in terms of deal valuation whether it’s a one-off deal or someone who is looking to build a portfolio?
• Are there exclusions to the risk transfer policies? And what is the claim payout history so far?
• Are there standardized terms in the independent sponsor space, or is it still deal by deal?

Watch the full webcast here.

Are you an independent sponsor seeking an advisor? Reach out to Robert Connolly or another member of LP’s Independent Sponsor Team.