Help - Precedent LBO Screening

When it comes to running a screen of debt financing packages for sponsor-backed acquisitions, especially focusing on benchmarking leverage, covenants, pricing, and other critical factors, there are several strategies you can employ using CapIQ and MergerMarket, despite the limitations compared to LoanConnector and direct industry team interactions. Here's a structured approach to efficiently pull together comprehensive screens:

1. Utilize CapIQ's Advanced Search Features: CapIQ offers robust search capabilities that can help you filter transactions based on specific criteria such as deal size, sector, geography, and type of financing. Start by defining your sectors of interest and use the advanced search to narrow down relevant LBO transactions. Pay special attention to the financing section to analyze the structure of debt packages.

2. MergerMarket Insights: MergerMarket can provide valuable insights into recent deals, including detailed reports and analyses on debt financing trends within your sectors of interest. Use these insights to understand the broader market trends and benchmark your findings against them.

3. Sector Reports and Analysis: Both platforms offer sector-specific reports and analyses. These can be invaluable in understanding the typical leverage levels, covenant structures, and pricing within specific industries. Use these reports to benchmark your findings and identify any outliers or trends.

4. Networking and Informal Channels: While your interaction with overseas industry teams might be limited, don't underestimate the power of informal networks. Engage with peers, join relevant forums on platforms like Wall Street Oasis, and participate in industry webinars or virtual roundtables. Often, practitioners share valuable insights and experiences that can aid your research.

5. Public Filings and Press Releases: For publicly disclosed transactions, sift through SEC filings (for US-based deals) or equivalent regulatory filings in other jurisdictions. Press releases by the involved parties often detail the financing structure, which can be a goldmine for benchmarking purposes.

6. Academic and Industry Publications: Look for academic papers, industry whitepapers, and publications that discuss LBO financing trends. These can provide a theoretical foundation and historical context that might be useful for your analysis.

7. Leverage Financial Modeling Templates: Utilize any financial modeling templates you have access to for analyzing LBO transactions. These can help in structuring your analysis and ensuring you're covering all relevant aspects of the debt packages.

Remember, the key to an efficient screening process is a combination of leveraging the tools at your disposal, engaging with the community for insights, and conducting thorough research using publicly available resources. While the absence of direct access to LoanConnector and limited interaction with industry teams pose challenges, the strategies outlined above should help you compile a comprehensive benchmarking analysis.

Sources: How to think about Debt for Acquisitions, How to think about Debt for Acquisitions, Debt Fund/Direct Lending Recruiting, https://www.wallstreetoasis.com/forum/real-estate/2018-thinking-about-acquisitions-or-debt-at-this-point-in-the-cycle?customgpt=1, Debt & Equity groups with the best exit ops to Institutional Acquisitions?