To say that any acquisition of a company will be made at a fixed multiple of EBIDTA, ignores:
1. The rate of increase in earnings and EBIDTA. Amnf has consistently grown earnings at 15% or more. Do you really believe that if it were growing earnings at 3% that the EBIDTA multiple for a deal would be the same? I don't.
2. I disagree that the acquirer's plans to transform a business so as to earn much more and increase ebidta substantially does not significantly affect the purchase price. Suppose a company had idle capacity which it could use for Amnf production, had distribution throughout the West Coast and many accounts in the expanded area who would likely take on Amnf's line, could greatly minimize or eliminate brokerage fees compared to the present, etc., etc. Would none of this matter in coming up with an EBIDTA multiple that the buyer would be willing to pay? I think not.,
I think you're ignoring certain factors that could make amnf very attractive to a buyer at a higher price:
First, if the acquirer has a similar business with customers that do not currently buy amnf products, there is room for expansion of amnf products to new accounts, coupled with reduced distribution and brokerage fees. While this could, alone, be significant, the home run would be if a larger company were willing to expand amnf's geographic area. Again, if they already have accounts for their own business, such expansion could be done more cheaply by an acquirer than if amnf did it by itself. If the acquirer had excess capacity in an existing manufacturing facility that could be used for amnf, even better.
The point is that there does not see to be anything unique about Northern California. For the right acquirer with capital and existing synergies, amnf could be worth much more than 70M because they would see amnf's business expanding rapidly and you are valuing the company on a static basis (even then I think you are low by 20%+).
The caveat is that a 100 share bid could be there from the market maker and not show many more shares that he is willing to buy. Same on the sell side. I'm sure you have seen many times where a 100 share asked is shown and the stock trades thousands of shares at that price with the asked unchanged and the 100 share strength remaining.