Mini LBO Underwrite
You are underwriting a 5-year LBO for a private equity investment committee. Company (fictional): HarborTech Services (HTS) –…
Assumptions used Term Loan amortization = 1.0% of original $480m = $4.8m/yr Mezz PIK accrues to principal; mezz cash interest calculated on beginning mezz balance including PIK Cash taxes use: 25% x max(0, EBITDA - total cash interest); PIK is not cash-deductible FCF after required debt service is used for optional…Read the full answer
MEMORANDUM To: Investment Committee From: Underwriting Team Date: October 26, 2023 Subject: Project Harbor – HarborTech Services (HTS) LBO Underwriting Transaction Overview & Sources & Uses (at Close, end of FY2025) Entry EBITDA: $120.0m Entry Multiple: 12.0x Enterprise Value (EV): $1,440.0m Transaction Fees (2% EV)…Read the full answer