The client was a privately held group of general practitioner doctors clinics who were undertaking an acquisition strategy. The company had reached just over A$16m of EBITDA and were commencing the IPO process. An acquisition opportunity at an attractive valuation (4x EBITDA multiple) surfaced which required a further A$20m of funding. Debt funding was exhausted and the ASX listing advisor recommended that such a material acquisition would need to be bedded down and synergies realised before they went to market. Given they had a clear path to an IPO in the next 12 months, the company was able to obtain a convertible note at a 10% interest rate and a 20% discount to future IPO price. The company listed at a ~8x EBITDA multiple meaning the convertible note funded acquisition was extremely value accretive for the existing shareholders. For the incoming pre-IPO investor they were able to lock in a 30% IRR on their position which was well above their fund target benchmark.