hard · Private Credit & Debt underwriting-credit-analysis
Project Phoenix is a $500,000,000 LBO with $300,000,000 of debt. The debt has a 5% annual mandatory amortization. EBITDA is $75,000,000. Capex is $8,000,000, taxes are $7,000,000, and cash interest is $21,000,000. The ECF sweep is 50%. Calculate the Debt Service Coverage Ratio (DSCR) for Year 1, defining DSCR as Operating Cash Flow divided by Total Debt Service.
- 1.25x
- 2.86x
- 1.67x
- 2.14x
Sign up free to see the explanation and track your rank →
More Private Credit & Debt underwriting-credit-analysis practice
- What is the Enterprise Value?
- A lender is determining the maximum debt capacity for an LBO… — What is the maximum suppor
- If the investor hedges the currency risk using forward contracts, what is the approximate
- If the sponsor uses $360 million in total debt, what is the entry Net Debt / EBITDA levera
- A credit agreement includes a 75% 'Excess Cash Flow Sweep'.… — How much of this cash must
- If the fund provides a $200M senior loan, how does the inclusion of add-backs affect the r
- If EBITDA grows 8% annually and all free cash flow is used to pay down debt, what is the e
- If the cumulative probability of default over a 5-year investment horizon is 8%, what is t