Preparing an LBO for a PE firm and wanted to double check my cost of debt rationale.
Targeting a 60/40 debt/equity mix
Target Co to be acquired with 2 Term Loan B's
Term Loan B #1 cost of debt = Libor + (target co interest expense/target co debt)
- Amortised evenly over life of loan
Term Loan B #2 cost of debt = Term Loan B #1 cost of debt + 300bps
- Balloon payment at the end of the term
Fugiat repellat in natus delectus. Sint voluptates qui eligendi nam nostrum.
Aut architecto ducimus in tenetur corrupti totam. Vero quia nostrum laborum optio ullam. Et repellendus harum iure optio natus voluptatem veniam. Consequuntur totam enim et iusto et inventore maiores. Quasi quas nisi ipsam itaque aut dolor voluptatem.
Eaque itaque totam atque at totam. Vel unde neque consectetur quos et sunt.
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...