Francine Way

JULY 17, 2017

This current post about Leveraged Buy Out (LBO) is about a valuation method used by a very specific type of financial acquirer: private equity (PE) firms. Building a historical 3-statement model and a debt-interest schedule. Building the go-forward debt-interest schedule. Building a proforma balance sheet.

Valuation 130

Valuation M&A Debt Book-building 130

Francine Way

JULY 12, 2017

Calculate cost of debt, cost of equity, and weighted average cost of capital (WACC). Determine the year-by-year future non-equity claims from the latest 10-K, especially those that will occur during the forecast horizon, and their combined present value. Derive Free Cash Flow to Firm (FCFF).

Discounted Cash Flow 130

Discounted Cash Flow Valuation M&A DCF 130

Deal Lawyers

JANUARY 11, 2024

Since 2018, John has addressed the debt default activism phenomenon on this blog and discussed related considerations, including contractual provisions designed to thwart default activists. Here’s an excerpt: In last year’s memo, we […]

Debt 100

Debt Private Equity Equities 100

OfficeHours

JUNE 6, 2023

Private equity is an investment asset class that has gained significant prominence and popularity in recent decades. However, private equity can seem complex and intimidating to beginners who are unfamiliar with its fundamentals. The Different Types of Private Equity Firms Private equity firms come in different sizes and strategies.

Private Equity 147

Private Equity Equities Debt Investment 147

Francine Way

JULY 13, 2017

Calculating cost of debt, cost of equity, and weighted average cost of capital (WACC). Determining the year-by-year future non-equity claims from the latest 10-K, especially those that will occur during the forecast horizon, and their combined present value. Enterprise Value = Market Capitalization + Total Debt - Total Cash.

Valuation 130

Valuation M&A DCF Book-building 130

Francine Way

JULY 7, 2017

Thus far in the last 10 blog posts, we have discussed what M&A is, its success metrics, types of acquirers and value creations, capital structure, debt, and equity. In Blog #02 of the M&A series, we discussed SWOT analysis. and (4) support long-term business strategy. and (4) support long-term business strategy.

M&A 130

M&A Acquisitions Consulting Capital 130

OfficeHours

AUGUST 25, 2023

In recent years, private credit has emerged as an important financing source for corporations of all kinds, especially for private equity-owned businesses with high financial leverage. Under this structure, banks typically provide committed financing to buyers (in this case, often private equity firms).

Private Equity 130

Private Equity Equities Debt Finance 130

Francine Way

JUNE 22, 2020

It has been roughly three years since my last blog post at the completion of my fellowship. To pick up where we last left off with valuation, I will cover the topic of a Merger Relative Valuation in this blog post and move on to other non-valuation topics from here. Negative equity balance. Working Capital deficit.

Valuation 130

Valuation M&A Mergers Mergers and Acquisitions 130

Francine Way

JULY 9, 2017

The comparisons can be based on several factors: Valuation: Total value, structure, contingencies, forms of payment (cash, buyer’s stocks, target’s stocks, seller’s notes, post-transaction debt, and more), and deferred payments (payments based on future performance) should be evaluated.

M&A 130

M&A Acquisitions Valuation Sale 130

OfficeHours

JUNE 30, 2023

Are you preparing for upcoming private equity interviews? If so, understanding the mechanics of a leveraged buyout is paramount… Paper LBOs are an important part of any private equity interview. To go from equity value to enterprise value, add the net debt (debt minus cash) of the company to equity value.

Private Equity 130

Private Equity Equities Debt Recruitment 130

Francine Way

JULY 11, 2017

The primary country sector return on equity (ROE) metrics (optional): Can be obtained through country specific sector ROE online resources commonly published by the country’s government’s economic / commerce / banking department or central banks. The primary country market risk premium: Can be obtained from sources such as Damodaran Online.

Valuation 130

Valuation M&A DCF Financial Statement 130

Francine Way

JULY 20, 2017

It bases the enterprise value calculation on the balance sheet equity and deduct any intangible assets (goodwill, customer lists, etc.). Equity value is determined by deducting par-value liabilities from reduced-value assets. The 1st one for today is the Tangible Book Value (TBV) method.

Valuation 130

Valuation M&A Business IT 130

OfficeHours

AUGUST 9, 2023

To know if the buyside is right for you, let’s start with a textbook understanding of “What is private equity?” Private equity involves investing capital directly into private businesses that are not publicly traded on stock exchanges (that would be a hedge fund). Strategic thinking skills are essential.

Private Equity 130

Private Equity Equities Investment Banking Investment 130

OfficeHours

JUNE 6, 2023

The private equity industry has experienced significant growth in recent years, leading to a highly competitive job market for aspiring professionals, particularly at the associate level. Below, I will provide a comprehensive guide on how to stand out in the competitive private equity associate job market.

Private Equity 147

Private Equity Equities Financial Modeling Financial Models 147

Francine Way

JULY 19, 2017

Balance Sheet: cash and cash equivalents, receivables, inventories, prepaid expenses and other current assets, Net PPE, other assets, account payable, accrued liabilities, long-term debt, deferred tax and other liabilities. Other common outputs are equity value and enterprise value. valuation exercises.

Valuation 130

Valuation M&A DCF Stock 130

OfficeHours

JULY 18, 2023

In the pursuit of attractive equity returns, private equity firms have developed numerous innovative strategies beyond typical leveraged buyouts and take-private transactions. As it happens, this is an industry that has experienced a significant amount of private equity-backed roll-up activity.

Private Equity 130

Private Equity Equities Investment Mergers and Acquisitions 130

OfficeHours

OCTOBER 20, 2023

For private equity investors who have been monitoring the situation around inflation for the last few months to a year, many have been disappointed to see the slow trajectory with which inflation has been coming down from highs. Explore the role of private equity now. Currently, inflation in the U.S.

Investors 130

Investors Private Equity Equities Debt 130

TechCrunch: M&A

JUNE 29, 2023

million debt. A widely circulated blog post claiming knowledge of the matter said Wang had been diagnosed with depression, sparking discussion on entrepreneurs’ mental health issues in China’s tech community. million in debt. million in cash. It’s also taking on the startup’s $50.66

Debt 187

Debt Investors Recruitment Food 187

RKJ Partners

AUGUST 6, 2017

In our latest blog installment, we define and outline the key elements involved in the process of raising capital. Capital is generally grouped into three main classifications: Senior Debt, Mezzanine Capital and Equity Capital. Most entrepreneurs are very familiar with senior debt offered by traditional banks.

Debt 40

Debt Capital Raising Capital Equities 40

RKJ Partners

AUGUST 6, 2017

In our latest blog installment, we define and outline the key elements involved in the process of raising capital. Making equity dollars last is particularly important since they come at a high price. Although the price is high, these precious equity dollars are often a critical factor in an emerging company's success.

Debt 40

Debt Capital Raising Capital Equities 40

OfficeHours

OCTOBER 16, 2023

For the average person, rising interest rates are not ideal for those with significant amounts of debt, those looking to purchase a home with a mortgage, or many other use cases. Therefore, ideal private equity target companies have steady cash flows and minimize variable or unexpected costs. This can reduce returns significantly.

Investors 130

Investors Private Equity Debt Equities 130

OfficeHours

JUNE 5, 2023

The paper LBO is one of the most commonly used and intimidating interview techniques for private equity. Many candidates dread the paper LBO, but simply put, it is one of the most definitive “weeder” techniques used by many private equity firms and investment banking to lower the applicant pool.

Private Equity 147

Private Equity Valuation Equities Debt 147

OfficeHours

OCTOBER 23, 2023

However, for private equity investors, this uncertainty represents a unique opportunity to take advantage of investment opportunities in public markets. A “take-private” transaction in the context of private equity is a process by which a PE firm acquires a publicly listed company and converts it into a privately held entity.

Investors 130

Investors Private Equity Equities Investment 130

OfficeHours

OCTOBER 16, 2023

For private equity investors who have been monitoring the situation around inflation for the last few months to a year, many have been disappointed to see the slow trajectory with which inflation has been coming down from highs. Instead, inflation of 5% would mean that the private equity firm’s real return would be reduced to 15%.

Investors 100

Investors Private Equity Debt Equities 100

OfficeHours

JULY 4, 2023

Going to keep today rather simple — we want to celebrate and kick off the second half of the year with a simple offer for the first 10 people that take advantage of the below — PE Platform Access for $225 OFF = $74 out of pocket for lifetime access Our flagship program has placed mentees into most major private equity firms since launching in 2020.

Sale 130

Sale Private Equity Recruitment Equities 130

OfficeHours

OCTOBER 17, 2023

So you want to pursue a role in Private Equity and Growth Equity? Existing Debt The US is a country riddled with debt. Others may have car payments, mortgages, credit card debt, or other debt that could hang over their head as a large liability. How are you liking these recent blog posts?

Private Equity 130

Private Equity Debt M&A Investment 130

OfficeHours

AUGUST 20, 2023

Written by a Top OfficeHours Private Equity Coach Is PE a Good Fit for you? To know if the buyside is right for you, let’s start with a textbook understanding of “What is private equity?” During the hold period, the private equity firm can improve operations, management structure, and financial strategies to optimize the business.

Private Equity 130

Private Equity Equities Investment Banking Finance 130

Sun Acquisitions

SEPTEMBER 9, 2022

If it makes financial sense and you understand the dilution aspect of selling equity and the potential interference from investors, then yes, go ahead. In this post, we’re going to address what these are, some of the challenges to expect, how to sell the equity, and who to sell it to. Selling equity – the good, the bad, the ugly.

Equities 52

Equities Business Broker Investors 52

Focus Investment Banking

APRIL 7, 2024

One aspect that is often talked about and significantly impacts the business landscape is the relationship between interest rates, private equity groups, and business valuations. For private equity (PE) groups, these rates determine the cost of capital, which is essential for their investment strategies.

Private Equity 52

Private Equity Valuation Equities Business 52

Sica Fletcher

SEPTEMBER 25, 2019

In recent posts, we outlined the background of and reasons for the dramatic upsurge of private equity investment in the insurance brokerage industry , how the combination of private equity and low interest rates have dramatically raised valuations , and how private equity sponsored agencies increasingly dominate the insurance agency business.

Private Equity 52

Private Equity Equities Insurance Capital 52

Sun Acquisitions

APRIL 26, 2024

This blog post delves into the intricacies of different financing models, shedding light on the associated risks and rewards. Debt Financing: The Double-Edged Sword Debt financing is a standard route for companies pursuing M&A, offering the allure of leveraging existing assets to fund the transaction.

Mergers and Acquisitions 59

Mergers and Acquisitions Finance Finance Mergers 59

RKJ Partners

AUGUST 6, 2017

In our latest blog installment, we define and outline the key elements involved in the process of raising capital. Professional investors such as buyout firms and equity players know the importance of competition. Probably the most exotic of the instruments is subordinated debt. Private companies have the same opportunity.

Capital Raising 40

Capital Raising Capital Debt Finance 40

OfficeHours

OCTOBER 16, 2023

However, for private equity investors, this uncertainty represents a unique opportunity to take advantage of investment opportunities in public markets. A “take-private” transaction in the context of private equity is a process by which a PE firm acquires a publicly listed company and converts it into a privately held entity.

Investors 100

Investors Private Equity Equities Debt 100

Cooley M&A

SEPTEMBER 25, 2020

In a May blog post we discussed several initial observations regarding the dozens of M&A transactions that were signed prior to March 2020 and that were in jeopardy as a result of COVID-19. In other words, the specific performance remedy is conditional, and neither buyer nor the sponsor can be forced to close without the debt financing.

Debt 40

Debt Finance Finance Private Equity 40

RKJ Partners

AUGUST 6, 2017

In our latest blog installment, we define and outline the key elements involved in valuing a target company. The method assumes leveraging, whereby the cash flow of the company is used to pay-off the debt—ultimately building equity. As a result, the value of the company lies in its ability to repay the debt.

M&A 40

M&A Valuation Mergers and Acquisitions Discounted Cash Flow 40

OfficeHours

OCTOBER 16, 2023

Existing Debt : The US is a country riddled with debt. Others may have car payments, mortgages, credit card debt, or other debt that could be hanging over your head as a large liability. investment banking, private equity , VC, etc.) You can also check our various course curriculums for different careers (i.e.

Debt 113

Debt Investment Healthcare Accountant 113

Sun Acquisitions

FEBRUARY 14, 2024

Consider options such as raising capital through equity financing or securing a bank loan to fund your expansion plans. Financial strategies involve leveraging existing assets as loan collateral or tapping into private equity partnerships to support this goal. These strategies can provide the financial firepower needed to fuel growth.

Acquisitions 59

Acquisitions Business Debt Finance 59