medium · Investment Banking valuation-core
A private equity firm invests $200 million of equity in an LBO. In Year 3, the company performs a dividend recapitalization, returning $100 million to the sponsor. In Year 5, the firm exits the investment, receiving $400 million in proceeds.
What is the Multiple on Invested Capital (MOIC) for this investment?
- 3.0x
- 2.5x
- 1.5x
- 2.0x
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