Trending Content - Investment Banking Forum
| +139 | Restructuring: Anti-climactic Experience | 37 | 15m |
| +111 | IB Net Worth / Savings Check | 51 | 11h |
| +98 | Woman who emptied Knicks trashcan on street then stole it was DEI exec, worked at JPMorgan Chase | 25 | 9h |
| +79 | Stop sleeping on UBS - it’s pretty good | 29 | 7h |
| +71 | Hot take: I’d rather be at Desjardins than UBS for investment banking in 2026 | 13 | 3h |
| +56 | 2026 VAULT PRESTIGE RANKINGS | 30 | 1h |
| +39 | AI + Financial Modelling | 12 | 1d |
| +34 | Hardest interview experiences? | 20 | 6h |
| +28 | Summer before college | 18 | 2h |
| +26 | Current State of UBS in North America | 8 | 2d |
Career Resources
bump
Be more specific with regard to your question.
When current management uses their equity (their stake of the company) to help fund a transaction of their company.
^ that seems confusing, but let's say their company is going to go through an LBO. They will take their ownership of the company, and put that equity towards the total cost of the company. So, both the sponsor and management will have ownership (though, 9/10 times the sponsor will own more).
thanks, this is very helpful. Two questions: 1. So essentially, it works the same way as sponsors' equity, and that's why both of them go into the "sources" section? 2. Who bears the cost of the management rollover, will the management spend their own cash just as PEs do, or will PE firms "give" the "management rollover" to the management? and how does that accounting work?
The root of the word "rollover" implies that management had an equity stake prior to the transaction. The sponsor purchases a portion of management's equity and they "roll" the rest. From an S&U perspective, this rolled equity helps fund the 100% purchase price.
It would be very odd indeed for a sponsor to "give away" equity to management. In most cases, a management team that doesn't hold a significant equity stake in the target would be granted options struck at the deal price, which vest according to various milestones.
Voluptas aliquid omnis facere est consequuntur occaecati. Consequatur rerum aut nihil vero voluptatem rerum repellat. Ratione quia perferendis quae omnis quos est. Voluptatem illo optio veritatis rerum consequuntur non. Quo odit aut ut nihil minus amet eos.
Mollitia natus est aut qui qui beatae possimus. Enim iste et est quis officia distinctio. Consequatur quis culpa est tempora soluta quidem. Quam ut numquam rerum ullam. Laudantium quidem laboriosam assumenda quidem eligendi nulla. Provident exercitationem odio neque.
Id sunt mollitia eaque quos beatae. Laboriosam suscipit temporibus in culpa.
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...