Asset vs. Share Deal LBO
Hi all,
If i am supposed to build an LBO model structured as an asset deal - is this just the same as a normal LBO? Or what do i have to change?
Hi all,
If i am supposed to build an LBO model structured as an asset deal - is this just the same as a normal LBO? Or what do i have to change?
Career Resources
In Europe you revalue the assets to fair market value and therefore depreciation will increase post transaction.
Thank you. But in terms of the model all is similar to a share deal model; if for example you ignore the asset fair value valuation?
Big differences on your tax schedules (e.g. you can amortize goodwill for tax purposes in asset deal)
Thank you. Imagine a Modelling Test is structured as Asset Deal, what do you I have to build compared to a normal LBO?
D&A increases, so you pay less taxes. That's it.
In a share deal, the accounting D&A increases but not the tax D&A, so you don't actually get the extra tax shield. In an asset deal you do.
Sorry, but why is D/A increasing and how should i model this?
No DTL is created from write-ups, Amortize Goodwill, NOLs wiped out (usually don’t use for good LBO candidates anyway), that’s most of it.
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