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Warrants & Management Hurdle Rate
I did a LBO model test recently. I was unsure of a few points: Say our exit equity value is $300MM and IRR is 25%. We have mezzanine debt structure with warrants of 2.5% of exit equity value. We also have a management hurdle rate at 10% which will pay out 15%. What returns will the Sponsor get
Do you use the Treasury Stock Method when calculating Ownership in an LBO test with Mgmt Option Pool?
I've noticed it seems that sometimes it's used, and sometimes it's not. On a model test, should it be used? Taking an example...assume: -Initial Sponsor Equity **= $100 (no mgmt rollover) -Exit Equity Value = $200 -Mgmt Option Pool = 10%, strike at initial sponsor equity -Shares Outstanding...
LBO Model Practice Sources?
Hi Guys, Wondering if you have come across any good LBO modeling exercises available on the internet? Personally, I've used the WSO model course, the free StreetofWalls modeling example and the Macabacus one. Would be interested to know if any other sources are out there. Any insight would be much...
Modeling Test: Option Pool Question
Hi All- I’ve been working through some of the WSO LBO modeling tests from the PE guide. My question relates to the Basic LBO 2 model and the option pool. There is a dividend recap at the end of year 3 and the sponsor exits in year 7. A management option pool is exercised on exit. The formula for...
LBO Model Issue
Hi guys - Building an lbo model for the first time and having trouble balancing the model. Gone through everything and not having any luck. Any help would be massively appreciated Cheers
Why the ending balance of debt under LBO Model is negative? Am I supposed to adjust it?
I'm now working on the simple lbo model for uni competition. But I tried several times that the ending balance of the debt still be negative. Should I adjust it, if so, how?
Modeling debt paydown monthly
I am working in a 3-statement monthly operating model that sums 12 months into a consolidated yearly output. I have to take on a revolver and term loan one year into the model. Having trouble showing the debt paydown schedule because its by month. Any advice is much appreciated.
Calculating cash returned from an IRR value?
When looking at cash flows I usually use XIRR(), but I'm working on a project where I want the IRR to be the independent variable and have the cash returned dependent, so that I can look at different cash returns on certain IRR values. Is there an Excel formula for something like this? Don't want to...
SO confused about this LBO model SOMEONE HELP PLEASE
So i am a freshman that is just starting to put together an LBO as an assignment. For my template, we have the operating model, assumptions and then the actual lbo model included. Where on earth do i start from? Operating model or the assumptions and why? Is there a place where i can see someone...
Modelling exams: How to balance with minimum cash and debt paydown?
Hey guys, I've always had a problem thats a bit of a pain on lbo models for exams. In my models I make from scratch the balance sheet ALWAYS has the same problem. Everything is perfect, except for the change in working capital and debt schedule. I know what the errors are exactly, so let me explain....
The Nuances of an LBO
Hey everyone, So, naturally I have little to no advanced modeling skills. However, I've taken it upon myself to teach myself to build a fully functional, dexterous LBO model. I've been using Rosenbaum's Investment Banking book to guide myself through it (unfortunately, I do not have his models*)....
How to apply the LBO model?
Dear all,
Dell LBO Model
If you work (or follow) Wall Street you know the most talked about deal in town right now is the potential Dell buyout by Silver Lake Partners together with Founder Michael Dell , who holds 15.7% of the company.
Model unbalanced by decimal places
I have a model I developed that is of medium complexity, and I have an interesting problem that I am not sure how to resolve, thought I'd hit you guys up to see if anyone has dealt with this before.
LBO Stub period (i've searched already)
I was tired of using other's models so I built mine from the ground up, it's pretty much done other than the stub period. I am having a bitch of a time figuring out how to incorporate this. My date/calendarization inputs are all setup and the model automatically calculates the days between close and...
Looking for a free online LBO model
Hi, I wonder if anyone knows of a good, quick and dirty, and free lbo model , preferrably online and with a simple tutorial. Appreciate all help.
HELP with LBO model (adjusting BS pro forma)
I'm building an lbo model as an exercise on a restaurant company and my pro forma Balance Sheet does not balance. It's got to have something to do with my M&A And Finance adjustments, but I've checked, and re-checked everything and to me it looks okay... but obviously I'm missing something. I know...
Use of LBO model as a valuation tool
How does a lbo model is used in sell side M&A assignment. My understanding is that LBO model is used for going private transactions. How do we use this model as a valuation tool and what are the steps involved to use this model as a valuation tooll
Take-home model
For the take-home case studies given, how detailed are the models expected to be? For example, I've prepared more of a shortform screener that has all the usual features of a full one, including a mini depreciation & amortization sched. but I fear that it maybe too simple for a take-home. From the...
LBO question - Financial statements?
Let's say you know you will need $xx in CapEx as soon as you take over a company, but you don't want to have to rely on cash flows to fund this. How do you build this into an lbo model ? Would you have to increase the total amount invested by the PE firm? What would be the implications on all three...
Walk Me Through an LBO Model?
Hi, I need your help. What is the best way to respond to "walk me through an LBO model " question. Any good advice/suggestions? Things to avoid? Much appreciated. 15% Off wall st. prep Financial Modeling Training Click Here Interview Question - Leveraged Buyout Walkthrough This is a very common...
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