Hello guys,
I am working on a case study and have to write a critical essay about a PE acquisition, and I have just few data available to perform a brief financial analysis of the acquired company.
I have:
Ebitda 2009 : 300 K Net Sales 2009 : 600 K RAB (Regulated Asset Base) 2009 : 3000 K FCF 2010 : 105 K
I would like to have some sort of advice on how to proceed with these data to perform some sort of analysis. Is there any way I can have some sort of quick valuation with these data?
I also have a slide with the description of the financing package including the covenants on the debt. Here I have a section telling me about pricing and fees of the financing. I have a margin over debt of 275 bps. Does that mean that the interest rate for that loan is EURIBOR + 2,75%? What kind of considerations are usually made when analyzing a financing package?
Thank you very much and I apologize if I posted this question in the wrong section.
It's tough to get valuation without a growth rate, as growth is a major driver of value. I suppose you could use assets as a driver for growth.
With covenants and financing info, you can dig into the credit analysis.
But based on the breif numbers, the company is kinda expensive
FINANCING PACKAGE STRUCTURE
TERM LOAN €800m CAPEX LINE €150m WC FACILITY €75m
Tenor 5years
Pricing
275bps from year 1 to year 3
325bps from year 3 to year 4 425bps thereafter
Fees Upfront fee:1% of principal amount Participation fee: 1.25% of committed amount Commitment fee: 35% of the applicable margin per year
COVENANTS
Interest cover ratio = FFO / Net finance charges
DEFAULT >2.35 from year 1 to year 3 >2.15 thereafter LOCK-UP > 2.65
Leverage = Net debt / EBITDA DEFAULT 5.5 LOCK-UP 5.2
VIR leverage= Net debt / VIR
DEFAULT 50.5%
LOCK-UP 45.5%
LTV =Net debt / RAB DEFAULT 65.0% LOCK-UP 60.0%
Will this help? What can I say about this financing package?
Thank you very much
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