Recognize the possible risks and rewards of completing a leveraged buyout
Identify the key factors necessary for a leveraged buyout to be successful
3 Topics
Identify the key characteristics of an ideal LBO candidate from a private equity perspective
Evaluate the soundness of a leveraged buyout using business valuation; cashflow forecasts; human-capital valuation; and the analysis of future returns and ROI
Identify strategies for avoiding bias in the valuation of an LBO deal
4 Topics
Differentiate the types of credit instruments used to finance LBOs
Recognize the risks and rewards of different debt options and when in a credit cycle each is likely to be available to an organization
Determine how to structure leveraged transactions; including identifying the appropriate amount of debt
Identify how the recovery values for different stakeholders may differ when an organization defaults on different types of credit instruments
2 Topics
Analyze how the metrics used by credit investors affect availability cost and structure for the credit component of LBO financing
Determine the current point in the credit cycle and whether the markets are open to LBO financing
4 Topics
Calculate the free cash flow available to service the principal on outstanding debt
Develop assumptions for a base and downside forecast
Determine whether an LBO generates free cash flow using a baseline case and a downside forecast
Analyze how completed forecasts affect key credit analysis ratios
3 Topics
Analyze the key elements of an investment thesis that guides a successful LBO
Recommend financing strategies for LBO candidates that are more likely to lead to a successful outcome