Mini LBO Underwrite
You are underwriting a 5-year LBO for a private equity investment committee. Company (fictional): HarborTech Services (HTS) –…
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
1. Year-by-Year Financial Projections (FY2026–FY2030) Key Inputs at Close (FY2025): Purchase Price: 12.0x EBITDA = $1.44B Total Debt: 5.5x EBITDA = $660M Term Loan: 4.0x EBITDA = $480M (9.0% cash interest, 1.0% amortization) Mezzanine: 1.5x EBITDA = $180M (12.0% cash interest + 2.0% PIK) Equity: $1.44B - $660M = $780M…Read the full answer