LBO Modeling

Description

AMT Training has a new home!

In 2021, AMT Training joined Training The Street

The new global standard in financial modeling and valuation training
We have expanded our product offering by combining our content libraries with Training The Street. You can find your training solutions for corporate, Public Courses, and self-study all in one place.

Who should attend the course?

• 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

What you will learn

LBO Modeling

Delegates 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 finance structuring. Delegates complete a fully integrated model with an income statement, balance sheet and cash flow statement.

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