Course description
LBO Modeling (1 day)
Participants learn how to structure an LBO and model the impact of the new financing structure. This session concentrates on understanding the implications (both modeling and deal) of the finance structuring. Participants complete a fully integrated model with an income statement, balance sheet and cash flow statement.
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Upcoming start dates
Suitability - Who should attend?
- New hires who have joined the firm late and missed the in-house program
- Individuals looking to fill a knowledge gap
- Experienced bankers looking to refresh their technical skills
- Teams employed in financial strategy roles from non-banking corporations
- Graduates preparing to interview for a role in the finance sector
- Students at business school and looking for a career in finance
Training Course Content
Learning Outcomes
- General overview of a levered transaction: basic principles
- Drivers of value creation in a levered transaction
- How leverage increases the return on equity
- What makes a good LBO candidate
- The concept of cash flow lending
- The lender’s perspective: risk, return and exit routes
- Structural subordination
- Financial instruments used in levered transactions
- Senior debt (revolving facility, terms A, B and C)
- Second lien
- Mezzanine loans
- High yield bonds
- PIK notes
- Preferred shares, shareholder loans and vendor loan notes
- Ordinary equity
- Build a full LBO model from a template
- Main deal assumptions: focus on cash flow drivers and how to sanity check preliminary assumptions
- Sources and uses of funds table
- Ownership structure
- Goodwill calculation
- Creating the opening balance sheet
- Deal adjustments, including amortization of debt issuance fees
- Tax loss carry forwards
- Cash flows available for debt servicing
- Repayment schedules for individual debt instruments
- Acceleration of debt payments using a cash sweep mechanism
- Modeling the revolving credit facility
- Circularities and the interest calculations
- PIK interest
- Credit ratios
- Calculation and interpretation of returns to the equity investors
- Calculation and interpretation of returns to mezzanine investors
- Sensitizing the outputs of the analysis
- Modeling different operational scenarios using Excel functions
Course delivery details
While this is a face to face training course, a blended learning approach is taken and delegates will be provided with access to AMT Online. Our study materials contain both the knowledge and practice materials required to assist with the learning process and help you in your job role. Course materials include:
- e-binder
- laminated summary sheets
- 24/7 access to DELTA online learning environment
- class recordings
- course notes
- quizzes
- electronic homework/study files
Reviews
Average rating 4.8
The trainer is an awesome and understanding instructor with a sense of humour.
The trainer was a fantastic instructor - knowledgeable and very personable.
The trainer is a great instructor - very knowledgeable about the content they covered.