Beginner LBO Modeling questionsEN
I'm trying to create an LBO for a case.
1. This might be a very stupid question, but why does a DCF model add back depreciation, but the LBO model does not in the calculation of free cash flow? (Would it be wrong to add depreciation in an LBO?)
2. What are typical IRRs? I'm getting 19% but I added depreciation into the calculation of FCF
3. What are typical financial buyer acquisition control premiums? I assumed 10% if there even is one...
4. I don't know if this is some standard, but from what I can tell blue=hard coded and black=not hard coded.. what is red?
5. What is the usual % paydown (of debt) by year 5 (exit year)? I am getting 100% by year 6, but the model goes until year 10.