easy · Investment Banking valuation-core

A company has a significant Net Operating Loss (NOL) balance.

How does this affect the attractiveness of an LBO of the company?

  1. Decreases attractiveness by limiting debt capacity
  2. Decreases attractiveness because NOLs are seen as a sign of failure
  3. Increases attractiveness by shielding future cash flows from taxes
  4. Has no impact because of Section 382 limitations

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