Mini LBO Underwrite
You are underwriting a 5-year LBO for a private equity investment committee. Company (fictional): HarborTech Services (HTS) –…
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
518.51935 New TL: 276.34682 - 86.82747 = 189.51935 Mezz: PIK 194.8377888 * 0.02 = 3.896755776 New Mezz: 194.8377888 + 3.896755776 = 198.734544576 Ending Balances: TL: 189.52 Mezz: 198.73 Total Debt: 388.25 Exit (End of FY2030): Exit EBITDA: 206.6252668 Exit Multiple: 10.5x Exit EV: 206.6252668 * 10.5 = 2,169.5653014…Read the full answer