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Leveraged Buyout LBO Modeling Course Overview
A leveraged buyout model – or LBO – is one of the most common models built at investment banks and private equity firms. This advanced class covers modeling best practices, creating multiple scenarios for assumptions, modeling the income statement and cash flow statement, as well as a complex capital structure. Additionally, we cover the calculation of IRR and cash-on-cash returns, credit metrics and covenants, error checks, and a dashboard with multiple types of charts and sensitivity analysis.Leveraged Buyout LBO Modeling Learning Objectives
By the end of the course, you should be able to:- Define a leveraged buyout (LBO) and build a detailed LBO model.
- Identify the characteristics of good candidates for LBO transactions.
- Examine a number of typical LBO exit strategies used by private equity firms.
- Outline the typical capital structure of an LBO transaction in terms of leverage and types of capital.
- Explain the characteristics of each piece of capital and its position and priority in the capital stack.
- Construct a full LBO model and evaluate the merits of the transaction by examining the equity returns.
