medium · Investment Banking

A financial sponsor is evaluating an LBO and calculates a 20% IRR over a 5-year hold.

If the initial equity investment was $400 million and no dividends were paid, what is the implied Multiple on Invested Capital (MOIC)?

  1. 3.00x
  2. 2.00x
  3. 1.20x
  4. 2.49x

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