Interview question minority interest
What is the treatment of minority interest in terms of a LBO context?
- What are the changes in S&U and PF adjustments?
Trending Content - Private Equity Forum
| +26 | How to Secure Higher Carry Award Before Promotion | 5 | 1d |
| +19 | Carried Interest Tax Question | 3 | 4d |
| +18 | I Don't Wanna Go To PE Anymore | 4 | 6d |
| +10 | How to prep for HH calls? | 3 | 2h |
| +9 | Leave MF PE for FP&A Manager at Top Company? | 16 | 2h |
| +9 | H.I.G GP Solutions / Secondaries Team | 1 | 4d |
| +8 | Private Equity Associate Recruiting as a Buy-Side Analyst | 3 | 1d |
| +7 | Stepstone PE Modeling Test | 3 | 20h |
| +6 | Vet Rollups | 5 | 8h |
| +6 | PSG Equity - London Office | 1 | 1d |
Career Resources
If I remember correctly each minority share counts as three-fifths of a normal share...
Isn't it treated in proportion to the % owned? You should add the portion of the sub that the company does not own back to EV to more accurately reflect the transaction. Otherwise, you'll end up with higher sales and EBITDA (from the contribution of the sub) and an EV that doesn't include the value of that interest.
You could also go about trying to take out the subs financial contributions to Sales and flowing through to EBITDA (or whatever OI measure you are using), but it seems much more difficult.
See: http://en.wikipedia.org/wiki/Three-Fifths_Compromise
That went right over my head. Damn 3rd Grade U.S. History.
Holy sh*t Cruncharoo that was gold.
Illo pariatur alias temporibus earum voluptas sit est. Nesciunt voluptatem consequuntur laborum.
Vitae nihil voluptate ratione vitae et qui. Tempora magnam molestiae quia voluptas animi minus quam. Libero et error minus optio amet voluptas. Voluptatem est consectetur magni dignissimos. Voluptas corrupti ducimus et eum repellat qui est.
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...