[Accounting question] In growth equity investments, should the balance sheet not be revised as well?
Hey guys, I have a quick question that's a little basic but still confuses me.
In an LBO, the balance sheet is adjusted to reflect new capital structure due to refinancing of oldco debt and new shareholder equity. Shouldn't a growth equity investment also involve some changes to the balance sheet due to new equity being issued for cash?
Sorry for the noob question, any help would be appreciated.
Hey Straightnochaser, I'm not too sure about the answer but I think CompBanker most likely would be able to help answer this one,
Your intuition is correct
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