Say a company sells only 30% of its equity to the public markets. Enterprise value will tell you the takeover value of the company will just be the market value of the 30% equity plus debt and all that jazz, but to truly takeover the company you need to buy out the 70% that insiders still hold, right? So why in lbo models of a public company do we assume that the existing private, insider equity in the company is not a factor to our purchase price?
Maybe I'm not understanding what happens to private, insider interests during the IPO process right or something.
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