LBO in practice: structuring and modeling – Case and teams schedule
Marc-Elie Bernard
Academic Year 2015/16
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(Final) case
• Your Managing Director calls you in: “here are the historical data for Exoll,
please prepare a LBO model that you’ll walk me through first thing tomorrow
morning.
• I would like you to present the Target’s balance sheet in an “economic format”
showing:
– ‘uses’ on one side (assets + WCR)
– and ‘resources’ on the other side (Equity + Reserves + Net debt)
• The Target is one single business entity, a French S.A.
• Oh, also, as you will understand, Exoll is listed on Euronext, so it will be a
tender offer. Please include in your model scenarios in which we reach 95% or
above – and other scenarios below this threshold.”
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Guidance
• The case objective is to test you on the LBO modeling, not on your ability to
create a business plan, so please use “realistic” assumptions, i.e. likely and
reasonable:
– your assumptions must allow you to build a LBO model that “flows”…
– … so, for example, please do not create a business plan with a 100% p.a.
top-line growth that does not consume cash.
– in summary: for the projections, use your best judgment (a very important
quality for an investor… or any manager). The same goes for the EV!
• Be ready to be challenged on your assumptions, to be asked to change some
parameters (yes, ‘live’ in the classroom).
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Guidance (cont’d)
• Please bring:
– your model in electronic version, and
– 5 print-outs.
– You have the option, if you think this would be more efficient and help
clarify your work (but this is just a suggestion and in no way a requirement),
to put together a PowerPoint presentation (i) showing the model (with
assumptions and results) and (ii) explaining how it is constructed and how it
works.
• Your final output: 13-15 pages
– 1-page summary (you figure out what it should include!)
– 9 pages (3 financial statements for target, holding, consolidated)
– (you can add detailed pages for financing assumptions / debt schedules /
mezzanine / etc.)
– Key ratios
– IRR calculation(s)
– Value creation
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IMPORTANT WARNING
• I Am fully aware that you were distributed examples of LBO models in other
classes.
• DO NOT REUSE THEM!
– the objective of the final class is that you create a model from scratch.
You will not gain all benefits from the exercise if you go the lazy way.
– groups that have done so in the past have consistently missed important
steps in the process as these other examples are not based on models
coming from PE firms, but rather from investment or commercial banks.
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Teams summary
• Monday, April 4, 2016 – 8:00 to 10:00
KKR ALAKBAROV Ayaz
ANGRISANI Matteo
CAVALIERE Riccardo
UMAROVA Yana
Goldman DENIZOT Lukas
Sachs KERJOUAN Erwan
Capital JEBRIL Khalil
Partners PULLMAN Jonathan
Carlyle CODRON Julia
KONIECZNY Pierre
PANDRAUD Ondine
PERRIN Augustin
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Teams summary
• Monday, April 4, 2016 – 10:00 to 12:00
Texas ARKADYEV Grigory
Pacific AVERIN Stepan
Group MALEON Sylvain
ROCCO Simone
IK Partners GÖBEL Celine
MATHEW George
SCHNEIDER David
STEGMAIER Andreas
Ardian HUANG Yushan
LI Meiying
LIU Huanrui
WU Zexi
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Teams summary
• Monday, April 4, 2016 – 13:00 to 15:00
CVC Capital BONTEMPS Grégory Michel
Partners FAUQUEX Philippe
VORNDRAN Daniel
SVENSSON Nicholas
Bain FAIGES GIL Marc
Capital IVANOVA Anastasia
MESTRE PIQUET Jordi
MONTANÉ VILANA Xavier
Apax PANARITI Klajd
POIRMEUR Pierre
VELON Romain
ZAKARIA Abdelhamid
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Teams summary
• Monday, April 4, 2016 – 15:00 to 17:00
BC Partners DE RIDDER Dieter
FLAMMANG Jean
RAINVILLE Christophe
VANDEKERCKHOVE Lawrence
Blackstone JIN Siyi
MACEDO FARIAS André Luís
MAUDONADO BISSOTO Luiz Ricardo
ZYKOVA Evgeniya
Advent Mr CARRIERE Matthieu
Mr DENG Jiejin
Mr HASPESLAGH Willem
Mme RENDAK Polina
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