如何建立LBO模型

maexhibits\\models\\lbo_short_htg.doc kekiehl 4 Apr 2013 5:43 /10

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LBO Short Form Model How To Guide

Getting Started Key Notes About Model Layout The worksheets in the model are:

— Description — explains key assumptions made by the model and contains the “last

modified date,” so you know if you have the latest version of the model (when starting a new project, always download a fresh version from the web); also contains a log of revisions to the model — LBO — LBO model with inputs for key drivers and assumptions, capital structure,

projections, etc.; the model is split into 7 pages:

1. Key Drivers & Assumptions, Warnings, Modeling with Circular Formulas — the

“Key Drivers & Assumptions” box is where you input some key data such as the

purchase price, options, and balance sheet information and make some key choices for assumptions about the exit (ownership and multiples), goodwill, fees, and the use of recap accounting; the “Warnings” box will highlight any particular issues that arise based on the inputs and assumptions you have entered, for example, to check with experts regarding the tax deductibility of PIK debt with a high coupon; and the “Modeling with Circular Formulas” box notes some key issues in using circular formulas and contains a fix in case the circular formulas get stuck 2. Summary Page — contains the sources and uses of funds, summary credit stats,

and equity returns (everything you need to see whether your LBO “worked”); this is where you input your new capital structure and interest rate assumptions and where you enter your “Rules of Thumb” constraints on credit stats and returns 3. Income Statement — contains the historical and projected income statement and

operating assumption information; this where you input your 5 year projections and the assumptions to build the projections out from years 6 to 10; working capital inputs are in the assumptions at the bottom of the page 4. Cash Flow Statement — contains the projected cash flows including cash tax

benefits from tax-deductible goodwill and loss carryforwards; this is where you input capital expenditure projections 5. Capital Structure and Credit Statistics — contains the projected capital structure

and resulting credit statistics 6. Equity Returns — details the calculation for equity returns on a trailing EBITDA and

forward P/E multiple basis 7. Detailed Ownership Calculation — details the calculation for sponsor, sub. debt,

management and other equity ownership at exit

maexhibits\\models\\lbo_short_htg.doc kekiehl 4 Apr 2013 5:43 /10

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LBO Short Form Model How To Guide

Running the Model

This short-form LBO analysis is designed for valuation purposes — i.e., to determine (in a quick and dirty fashion) what a financial sponsor would be willing to pay for the target. The object of the analysis is to maximize purchase price while staying within the constraints of an appropriate capital structure and maintaining sufficient equity returns for the sponsor. As a first cut, these constraints will be laid out on the “Rules of Thumb” page available on the

Leveraged Finance home page. Once you have the model up and running, you will most likely want to consult with Leveraged Finance to determine if you have an appropriate capital structure for your particular target.

Begin by entering the Key Drivers and Assumptions in the box on the top of the LBO model worksheet. Next, move to page 3 and enter the historical and projected financials for the target. The model is set up to accept 5 years of projections. However, because the amount of bank debt that can be used will be limited by the ability to pay that bank debt off by maturity (typically, 7 or 8 years), the model is set to build out projections for years 6 through 10. To build these projections, enter the assumptions in the “Operating Statistics/Assumptions” section of the income statement. Don’t forget to input assumptions for working capital (in the Operating

Statistics/Assumptions section) and for capital expenditures (on the Cash Flow Statement page). Return to the Summary Page of the model to layer in the new capital structure using the “Rules of Thumb” page. Begin by layering in the maximum amounts of bank debt and

subordinated debt as a multiple of LTM EBITDA (see note below on LTM EBITDA). Enter the appropriate costs of debt. Don’t forget to enter a cost of debt for the Revolver in the case that the Revolver will need to be drawn down. Finish the initial draft of the model by entering in the leverage, coverage, and returns constraints from the “Rules of Thumb” in the Summary Credit Statistics and Equity Returns sections of the Summary Page.

Now it’s time to begin running iterations on the model to maximize purchase price. Check your leverage and coverage statistics. If any fail to meet target guidelines, reduce the amount of debt in your capital structure until the statistics reach target levels. Next, check your equity returns. If your equity returns are below target levels, reduce the purchase price until the equity returns are in line. (Since equity is a plug in the capital structure to make Sources of Funds equal to Uses of Funds, reducing the purchase price without changing the debt will

reduce the equity automatically.) If the equity returns are above target levels, raise the purchase price.

You will most likely want to check with Leveraged Finance to see if you have set up an appropriate capital structure for your particular target. You might also want to think about other ways to structure the transaction (asset deal or 338(h)(10) for tax-deductible goodwill, recap accounting for no book goodwill) to boost returns …… 此处隐藏：12539字，全部文档内容请下载后查看。喜欢就下载吧 ……