medium · Private Equity pe-core
A private equity firm acquires an industrial manufacturer, Zenith Corp, for $600M (10x LTM EBITDA of $60M). The firm identifies $10M in transaction fees and $5M in monitoring fees paid by the target to the GP at closing.
If the Limited Partnership Agreement (LPA) stipulates a 100% fee offset, how much is the fund's management fee reduced in the first year?
- $15M
- $12M
- $0
- $10M
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