LBO Structure Analysis
Hi,
I was just analyzing this LBO and I have some questions about the capital structure. I hope you can give me some insight on the reasoning behind this specific capital structure.
So, the case is as follows: A PE company acquires a target that has been held by another PE before. (Secondary purchase).
The purchase price is about 600 m€ with 42% equity and 58 % debt financed. My first question is: what could be the reason for the low percentage of debt?
The debt only consist of a high yield secured bond. Why wouldn't the PE company take bank loans (senior loans) or even get their hands on mezzanine. As far as I know HYB are very cost intensive as you have to get a rating etc...
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