Priv Cap Markets / LevFin Summer Assoc Roles

Based on the most helpful WSO content, here are some insights and resources to help you prepare for a Private Capital Markets (PCM) or Leveraged Finance (LevFin) Summer Associate role:

Key Areas to Focus On:

1. Debt Schedules and Cap Tables:

   • Cap Tables: Understand the capital structure of a company. This involves creating cap tables that show different debt structures, starting with the most senior debt at the top (typically term loans and secured), followed by 2nd lien debt, senior unsecured debt, and then mezzanine or high-yield bonds.
   • Debt Schedules: Familiarize yourself with reading and interpreting debt schedules from public 10-Ks and Qs. Learn how to find pricing and yields using paid services like Bloomberg, SMI, and ADI if you have access to them.

2. Cash Flow Analysis:

   • Liquidity Rollforward: Project the company's cash flows into the future to identify potential liquidity events, such as large debt maturities, required capital expenditures, or cash shortages from operations. Start with EBITDA and calculate unlevered and levered free cash flows by accounting for capex, working capital, taxes, interest, and maturity payments.

3. Industry Research:

   • Resources: Utilize resources like Stephen Moyer's "Distressed Debt Analysis" for an overview of the bankruptcy system and debt mechanics. Houlihan Lokey's case studies and the Distressed Debt Investing blog are also valuable for understanding distressed companies and valuation techniques.

4. Credit Documents and Indentures:

   • Reviewing Credit Docs: Get comfortable with combing through credit documents and indentures, which are often attached to 10-Ks or found in 8-K filings. Use PACER for accessing court documents related to bankruptcy filings.

Recommended Resources:

• Stephen Moyer's Distressed Debt Analysis: Provides a comprehensive overview of the bankruptcy system and debt mechanics.
• Houlihan Lokey's Case Study: Offers practical insights into restructuring scenarios.
• Distressed Debt Investing Blog: Keeps you updated on the latest distressed companies and technical valuation aspects.

Practical Tips:

• Familiarize with Public Filings: Get used to reading 10-Ks, 10-Qs, and 8-Ks to extract relevant financial information.
• Use Financial Databases: If you have access, practice using Bloomberg, SMI, and ADI to find debt pricing and yields.
• Practice Cash Flow Projections: Work on projecting cash flows and identifying potential liquidity events using EBITDA and free cash flow calculations.

By focusing on these areas and utilizing the recommended resources, you'll be well-prepared for your PCM or LevFin Summer Associate interview. Good luck!

Sources: https://www.wallstreetoasis.com/forum/investment-banking/how-to-prepare-for-restructuring-technical-questions?customgpt=1, How to Prepare for Restructuring Technical Questions, Private Credit Resources and Prep, leveraged finance interview - what to prep, https://www.wallstreetoasis.com/forum/venture-capital/best-venture-capital-resources-to-prep-for-an-interview?customgpt=1