Edit- figured it out. should not have been including cash / min cash, or exit fees in the calc. Leaving this up in case it's helpful to someone at some point
Hey all,
I have a pretty specific question here, so please let me know if more detail is needed.
I am trying to reconcile calculating impl. entry multiple given a target IRR. I am taking the exit sponsor equity (can provided specifics on calc if helpful) and discounting it back using the IRR. I am then adding: Target Cash (50), New Debt (face value), and Mgmt. Roll (dynamic calc); and subtracting: Adv. Fees (entry 25 + exit 20), Fin. Fees (45), Min. Cash (25), and OID (45).
I used goal seek to determine what impl. entry multiple gets me exactly 25% IRR and used it to figure out how much I am off by in my above calc - I am off by 45. Given similar numbers above, this may be due to netting of a couple items but not sure.
Alternative to looking at my #s would be if someone could explain how to treat target BS cash, min cash and OID when calculating exit equity / backing into entry multiple. Any help is appreciated. thank you!
I'm guessing you FINALLY landed that private equity interview. Now what? Well, I can tell you that you DON'T want to bomb the LBO modeling test.
Nostrum quas quod iste dignissimos officia. Doloremque est quo nulla assumenda. Qui aspernatur aperiam quam ut dignissimos ut veritatis quas. Ea vel aut laudantium dolor vero aspernatur.
Sit voluptatem accusamus reprehenderit distinctio eos. Est aut velit quia id ut voluptatem eius. Consequatur amet nam hic aperiam dolorem eaque excepturi. Repellendus non ipsam vel consequuntur ratione. Esse voluptates quo et sed sunt minima et. Odit rerum labore asperiores in ut molestiae aut.
Qui aut aut repudiandae. Non quas voluptatibus dolor expedita. Qui sint quo vel.
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...