Valuation & Deals · Relative value & deals
LBO Modeling
How private equity buys companies mostly with debt: sources and uses, debt paydown from free cash flow, exit value, and the three drivers of returns (EBITDA growth, deleveraging, multiple expansion). A full simple LBO solved by hand, plus the IRR and MOIC math.
Step 1 of 6 · Overview40 min read ·
Key idea
Prereqs: Three-statement model; DCF; Comps & precedents. Next: M&A accretion/dilution. Follows Rosenbaum & Pearl *Investment Banking* ch. 4–5, Wall Street Prep and Mergers & Inquisitions LBO guides.Next: 1. The idea