Dividend Recap: LBO Tutorial With Excel Examples

‼️Mini Paper LBO ⁉️A private equity firm acquires a company for $150M, financing the deal with 50% debt and 50% equity. At the time of purchase, the company’s EBITDA is $15M. 💡Over the next 5 years, EBITDA grows by $2M each year. The company also requires $5M of CapEx annually. 💸The debt bears a 10% annual interest rate, paid in cash each year, with no principal repaid until a bullet payment at exit. ‼️Assume no taxes, no transaction fees, and no changes in working capital. 🤔 At the end of fi

LBO Interview Question LTM EBITDA $100 Purchase TEV $800 4x Leverage ‼️EBITDA is flat over 5 years How much cumulative Cash Flow is needed for a 15% IRR? A) $100 B) $200 C) $300 D) $400 Follow @survivefinance to level up your IB/PE skills every day. 🚀🚀 👇 Full Explanation 👇 To answer a tricky LBO question like this, you have to take it step-by-step. ✅ Initial Investment Calculation: The Total Enterprise Value (TEV) of the purchase is $800. With 4x leverage, $400 is funded with debt (4 times $

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