Mini LBO Underwrite
You are underwriting a 5-year LBO for a private equity investment committee. Company (fictional): HarborTech Services (HTS) –…
Below is a simplified LBO build for HarborTech Services (HTS). All figures in $m unless noted. Rounding: tables are rounded; IRR/MOIC use unrounded math. Entry / Sources & Uses FY2025 EBITDA: 120.0 Purchase price: 12.0x EBITDA → Enterprise value = 12.0 × 120.0 = 1,440.0 Transaction fees: 2.0% of EV → 28.8 Total uses =…Read the full answer
Entry & Capital Structure Math Entry EV = 12.0x × $120m EBITDA = $1,440.0m Transaction Fees = 2.0% × $1,440m = $28.8m (equity funded) Total Uses = $1,440.0m + $28.8m = $1,468.8m Debt Raised = 5.5x × $120m = $660.0m Term Loan: 4.0x = $480.0m (9.0% cash, 1.0% mandatory amort = $4.8m/yr) Mezzanine: 1.5x = $180.0m (12.0%…Read the full answer