Enterprise Value technical

Suppose EV=200; no prefs or minority. Net Debt is 400. How much is Equity? If Equity is 0, what's going on here? How many cents on the dollar is this debt trading?

Can anyone walk thru the correct way to think about this?

 

Seems like capital leases is the missing ingredient...

EV is generally equal to the following:

EV = equity value + Net Debt + Other stuff

Where:

Other stuff = Preferred stock + Capital Leases + Noncontrolling interest

So if equity = 0, then:

200 = 0 + 400 + Other stuff

You said no preferred stock or minority interest, so capital leases would need to be -200.

 

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