hard · Private Credit underwriting-credit-analysis
An LBO is executed at an entry multiple of 8.0x on $100 million LTM EBITDA with $500 million of initial net debt. After 5 years, the company is sold for 9.5x on $140 million EBITDA, and net debt has been reduced to $250 million.
Using return attribution, which component contributed the most to the total increase in equity value?
- Multiple Expansion
- EBITDA Growth
- Synergy Realization
- Deleveraging (Debt Paydown)
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