Mini LBO Underwrite
You are underwriting a 5-year LBO for a private equity investment committee. Company (fictional): HarborTech Services (HTS) –…
HarborTech Services – 5-Year LBO Underwriting Entry Capitalization Item $m FY25 EBITDA 120.0 EV @ 12.0x 1,440.0 Term Loan (4.0x) 480.0 Mezzanine (1.5x) 180.0 Transaction fees (2.0% EV) 28.8 Sponsor equity 808.8 Year-by-Year Operating & Debt Schedule ($m) FY26 FY27 FY28 FY29 FY30 Revenue 972.0 1,040.0 1,102.4 1,157.6…Read the full answer
Entry & Sources & Uses FY2025 EBITDA: $120m Purchase Price (EV): 12.0x × $120m = $1,440m Transaction Fees: 2.0% × $1,440m = $28.8m Total Uses: $1,440m + $28.8m = $1,468.8m Total Leverage: 5.5x × $120m = $660m Term Loan: 4.0x × $120m = $480m (9.0% cash interest, 1.0% mandatory amortization = $4.8m/yr) Mezzanine: 1.5x ×…Read the full answer