Leveraged Buyouts

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JCP LBO Template
In the JCP LBO template self-study, Long Term debt on the balance sheet is linked from the debt sweep (I77), which includes preferred debt along with senior unsecured debt. Should preferred debt notional always be included in that manner or should it be included in shareholders equity? For the JCP... Read More
Adv LBO Model
How do you calculate Cumulative Debt Paydown as well as Cumulative % of initial Debt Paid in the Credit and Leverage Statistics in the model. thank you.
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added 5 years ago
Minimum Cash Balance
Do we put the minimum cash balance as a use of fund as well (in addition to source of fund)? Please explain thank you.
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added 5 years ago
Sources & Uses for less than 100% LBO
What is the proper way to set up sources and uses for an LBO where the sponsor is acquiring less than 100% of the target? I have typically included lines for roll-over equity in both the S&U in order to get the value of the total equity (rollover and purchased) from the sources to equal the equi... Read More
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added 5 years ago
Minority Interest in LBO Model
When doing a (UK) PtP LBO Model, I have to include in uses of fund the following (what I am quite sure about): Share Price (latest close) % Premium Offer Price per Share All Shares Outstanding Equity Offer Value =+Debt Refinancing =+Pensions =+Transaction Costs =+Tendering Costs =+... Read More
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added 5 years ago
LBO enhanced model question
The LBO enhanced model, once I put in 2007 as the last full year, uses 2007 as the year to add the balance sheet deal adjustments--even though the deal will happen in, say, August 2008. It then gives the 2008P and 2009-2012E balance sheets. This seems counter-intuitive: Shouldn't the deal adjust... Read More
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added 5 years ago
IRR calcs page on LBO Enhanced Model
I have a question re the IRR page. In the 3 separate IRR calcs, we distinguish between equity returns to sponsor, all-in sponsor returns assuming he also holds the mezz/warrants piece, and a separate mezz returns profile for an outside mezz/warrant holder. My questions revolve around proper IRR ... Read More
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added 5 years ago
Valuation - IRR
Do any of the self study courses include calculating the IRR of a transaction, I have taken the Core model and am now taking the enhancements course. The enhancements does do a NPV, but I am also working on a few private equity investments that require an IRR calculation. This is easily done, with E... Read More
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added 5 years ago
Why does an LBO set the floor valuation?
Full Question:
Why does an LBO set the floor valuation?
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added 5 years ago
How do you properly amortize debt items / paydown of debt?
Full Question:
How do you determine the amortization of debt items / paydown of debt for individual debt items?
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added 5 years ago
What balances the LBO model in the Sources & Uses of Fun
Full Question:
What balances the LBO model in the Sources & Uses of Funds?
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added 5 years ago
Insurance Company LBO Question
Full Question:
I am looking at the potential LBO of a small insurance company and have a question about how to model the transaction for purchase account purposes under GAAP and statutory accounting. Here are the assumptions:
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added 5 years ago
How to calculate / estimate transaction costs for an LBO?
Full Question: I am doing a LBO analysis of a small retailing company. The transaction EV is about $350 million and new equity is $100 (my number). What is the appropriate transaction cost for this analysis? You mentioned that the M&A fee was around 1-2% of TEV. But I am not sure about the lega... Read More
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added 5 years ago
How to set up Sources & Uses for <100% LBO?
Full Question: What is the proper way to set up sources and uses for an LBO where the sponsor is acquiring less than 100% of the target? I have typically included lines for roll-over equity in both the S&U in order to get the value of the total equity (rollover and purchased) from the sources t... Read More
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added 5 years ago
GAAP or cash
I'm making an LBO model of a public company but relying on analyst report forecasts (including bloomberg consensus) which I assume are non-GAAP. Should I adjust the analyst forecasts as much as I can for one times (amort of intangibles, restructuring) and use these for the P/L model with the GAAP ... Read More
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added 5 years ago
How to determine reasonable debt covenants for an LBO deal?
Full Question:
How do you determine reasonable debt covenants for an LBO deal
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added 5 years ago
What is the rationale for using PIKs in a LBO transaction?
Full Question:
What is the rationale for using PIK instruments in a LBO transaction?
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added 5 years ago
Using different debt securities to finance an LBO
Full Question:
What is the rationale for using senior discount notes vs senior notes vs term loan vs credit facility vs cash vs PIK preferred stock
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added 5 years ago
LBO Deal Structuring and Capital Lease Treatment Discussions
Full Question:
LBO Deal Structuring and Capital Lease Treatment Discussion Thread
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added 5 years ago
What is the purpose of management participation in the LBO?
What is the purpose of management participation in the LBO? Should the financial sponsors consider adding all company employees to participate in the LBO? If so, how would one structure the labor participation in the transaction?
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added 5 years ago
Is there a premium paid to the existing shareholders?
Is there a premium paid to the existing shareholders during the LBO transaction? i.e., the event of taking the company private? If so, why?
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added 5 years ago