Modeling NCI in an LBO
Hi all, currently working on an lbo model and was wondering how to generally treat non-controlling interest. Is it common for the sponsor to acquire the remaining portion of subsidiaries that the target company doesn't own, or does the target company generally continue to subtract the portion of income belonging to other owners after being bought out? Thanks in advance!
NCI in LBO question (Originally Posted: 11/12/2017)
Couldn't quite grasp NCI in the lbo model conceptually in the example below.. Income statement for 2017E: net income: 346, NCI: 5, net income attributable to parent: 351 Balance sheet 2017E NCI = 2016A NCI + 5
Given the IS, I'd assume that the NCI suffers loss that resulted a net income attributable to parent less to net income. However, if the NCI suffered loss, why would we add the 5 back to the 2016A NCI? Shouldn't we subtract it instead?
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