Private Credit case studies

Based on the most helpful WSO content, here’s what you need to know about private credit case studies:

1. Case Study Format:

   • Typically, you’ll receive a Confidential Information Memorandum (CIM) and possibly additional materials like filings or research reports.
   • You’ll need to build a standard financial model, including an income statement (with a focus on revenue build), cash flow, and debt schedule. Credit metrics such as leverage and DSCR (Debt Service Coverage Ratio) are crucial.
   • Expect to model downside cases or sensitivities to assess risk.

2. Key Focus Areas:

   • Analyze where to invest in the capital structure (e.g., senior, unitranche, mezzanine).
   • Evaluate the company’s recession resistance, recurring revenue vs. project-based work, customer base diversity, and revenue visibility.
   • Look for strong margins, a sticky customer base, and a clear value proposition.

3. Presentation and Write-Up:

   • You may need to prepare a write-up (often two pages) summarizing your analysis and recommendations.
   • Be ready to present your model, explain your assumptions, and discuss your rationale for the investment decision.

4. Preparation Tips:

   • Familiarize yourself with LBO modeling as private credit case studies often overlap with PE interview prep.
   • Review a debt primer to understand the nuances of credit investments.
   • Practice building models under time constraints to simulate real case study conditions.

Unfortunately, I cannot share specific case studies from firms like BX, Apollo, or Ares. However, you can explore WSO’s Private Equity Interview Course or Elite Modeling Package, which include LBO modeling tests and templates that are highly relevant for private credit preparation.

Sources: Private Credit Case Study