Leveraged Buyout (LBO) Model
Originally published: 21/12/2020 08:58
Last version published: 22/12/2020 08:50
Publication number: ELQ-32354-2
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Leveraged Buyout (LBO) Model

Leveraged Buyout (LBO) Model including outputs to print to PDF or transfer to a PowerPoint presentation.

The following LBO model should be used to analyze a leveraged buyout of a public company by a sponsor. The purpose of the model is to project out the performance of a company, input a new capital structure with which to buy the target company, and determine the returns of such a transaction. Looking for a model used by actual private equity professionals? Look no further. This model includes output tabs to assist you in translating your analysis into a presentation format. The model is meant to be used to quickly determine the feasibility of a leveraged buyout. This is not a full three-statement LBO model.

The model includes the following:

- Assumptions
- Sources & Uses: Illustrates what capital will be used to finance the various costs to acquire the public company
- Purchase Price Calculation w/ Options Oustanding
- Operating Assumptions: Used to project the future performance of the business
- Debt Schedule: Includes the capabilities for 4 tranches of debt including a revolver
- Operating Cases Assumptions: Used to create three unique operating cases to determine the potential returns under each operating scenario
- Credit Metrics: Illustrates the credit metrics of the company over the life of the investment
- Returns Analysis: Illustrates the IRR and MOIC to the GP
- Gross IRR Sensitivity: A sensitivity table that illustrates returns based on various assumptions
- Outputs: Outputs of all major relevant portions of the analysis and graphical representation of the IRR returns

This Best Practice includes
1 Excel Model

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