WALL STREET PREP – LEVERAGED BUYOUT (LBO) MODELING EXAM QUESTIONS AND COMPLETE SOLUTIONS
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Course
Wall Street Prep
Institution
Wall Street Prep
QUESTION 1
On December 31, 2016, JJB, a private equity fund, purchased Geozone, a company with $882.7 million in last twelve months (LTM) EBITDA and an 8.0x multiple. EBITDA will expand at an annual rate of 8% during the following S years. Geozone owed $50.0 million and had $20.0 million in cash a...
WALL STREET PREP -LBO
MODELING EXAM QUESTIONS
AND COMPLETE SOLUTIONS
, QUESTION 1
On December 31, 2016, JJB, a private equity fund, purchased Geozone, a company with
$882.7 million in last twelve months (LTM) EBITDA and an 8.0x multiple. EBITDA will
expand at an annual rate of 8% during the following S years. Geozone owed $50.0 million
and had $20.0 million in cash at the time of the acquisition.
Debt and cash balances remained steady throughout the next five years.
What is the equity value at exit if the sale occurs on December 31, 2021 at an 8x
multiple?
3,314.
7,031.6
7,061.6
10,345.8
10,375.8
QUESTION 2
Which of the tallowing would INCREASE cash available tor optional Revolver repayments?
Decreases in Accounts Payables
Increases in Mandatory Term Loan B Debt Repayments
Increases in Accounts Receivables
Increases in Capital Expenditures
Increases in Depreciation and Amortization
QUESTION 3
The next five questions use the data provided below.
On December 31, 2016, Silver Lane Partners, a private equity fund, bought Baezmore
Telecom (BT), a company with $882.7 million in last twelve months (LTM) EBITDA, for an
enterprise value of 8.0 times. At the time of the acquisition, BT had noncontrolling
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