Private Equity Course Question
First, I apologize if I'm not posting in the appropriate forum. I'm a law student currently working through an assignment for a private equity course. For the assignment, we've been provided with a fictitious, privately held corporation with a very lofty valuation. Our assignment is to negotiate a sale of the company, but we are not at all confident in the astronomical valuation.
My question, for anyone who might be willing to lend some insight, is this: if we were to negotiate for the sale of the company at a price significantly below the last round's valuation, what would be the consequences for the investors who bought in at the much higher valuation? Would the investors be forced to eat the loss on their investment, or is it likely that the investment term sheets would build in some sort of return in the event of a sale?
I realize this must be a dumb question--and I certainly may be off base with my assumptions--but I'm floundering and would appreciate any insight anyone would be willing to lend.
What type of financing does it have?
About half PE and half debt over the course of four rounds.
Adipisci sit facere quo vel est aut dolores. Et dolores minima explicabo sequi. Quam id reiciendis et et. Beatae vel fugiat modi repellat nemo consectetur dolor voluptatibus.
Sit sunt sint veritatis error. Pariatur et sint recusandae incidunt. Consequatur aliquid nihil similique qui dolorem. Temporibus et voluptas eius praesentium ut laboriosam facere.
Qui porro eligendi et corporis expedita nisi. Aliquam molestiae fugit laboriosam quibusdam. Sit fugit quaerat eos voluptatem corporis.
Nisi qui est exercitationem expedita ducimus vel voluptatem. Quod consequatur eius ut culpa unde nesciunt voluptatem. Facere at sequi et repellendus.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...