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 Conventions: $m. Interest is charged on beginning-of-year balances, which avoids circularity. Term Loan (TL) amortization is 1% of the original $480m, or $4.8m per year. Mezz PIK accrues to principal. All FCF after mandatory debt service sweeps to the TL.Read the full answer
Sources & Uses (End FY2025) Use of Proceeds ($m) Sources of Funds ($m) Purchase Price (EV) 1,440.0 Term Loan 480.0 Transaction Fees (2.0%) 28.8 Mezzanine 200.0 Total Uses 1,468.8 Equity Check 780.0 Equity Fees 28.8 Total Equity 808.8 Total Sources 1,468.8 Assumptions: Entry EBITDA: $120m. Entry Debt: 5.5x ($660m).Read the full answer