LBO MODELING EXAM QUESTIONS AND ANSWERS WITH COMPLETE SOLUTIONS VERIFIED LATEST UPDATE GRADED A++
0 view 0 purchase
Course
LBO
Institution
LBO
LBO MODELING EXAM QUESTIONS AND ANSWERS WITH COMPLETE SOLUTIONS VERIFIED LATEST UPDATE GRADED A++
Define LBO & Goals
A transaction where the buyer uses a lot of debt to acquire something: could be an asset, group of assets or business, or a house etc
The main focus of an LBO model is to calc...
lbo modeling exam questions and answers with compl
Written for
LBO
All documents for this subject (88)
Seller
Follow
LIXAN
Reviews received
Content preview
LBO MODELING EXAM QUESTIONS AND ANSWERS WITH
COMPLETE SOLUTIONS VERIFIED LATEST UPDATE
GRADED A++
Define LBO & Goals
A transaction where the buyer uses a lot of debt to acquire something: could be an
asset, group of assets or business, or a house etc
The main focus of an LBO model is to calculate the returns to equity investors
Why use leverage?
Helps amplify their potential returns by using debt.
Less of your own money needs to go into the business.
Sources & Uses
Purchase price = total uses
Total sources = debt + equity
Data Tables (Sensitivity Analysis)
- Data, what-if-analysis, data table
-turn on automatic calculations
Combo Boxes
, -useful for installing switches
-Under developer tab in excel ribbon
Conditional Formating
-Programming alerts based on certain conditions
-Home, styles, conditional formatting
-create "new rule"
Circularity Switch
LBO basics
-Up to 50-60% may be funded with debt
-buyer typically private equity firm
-assets and associated cash flows are used as collateral
Characteristics of good LBO candidates
-Mature, stable
-Predictable cash flows
-High margins
-low reinvestment needs
-undervalued relative to its peers
-strong management
-suboptimal capital structure
-strong brand & customer relationships
OR
-companies in fragmented markets which could allow for a roll up strategy
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller LIXAN. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $9.99. You're not tied to anything after your purchase.
