Basic LBO | Dataford Interview Questions

Your question is Basic LBO. Take a moment with it on the right.

Talk me through your thinking if you like. When you're confident, submit your answer and I'll grade it like a real screen (7/10 or better passes).

Problem

Walk through a basic paper LBO (leveraged buyout). Asked in the First Round stage. PJT M&A (Strategic Advisory) first round interview.

Task

Calculate entry enterprise value, debt, and sponsor equity contribution.
Project exit enterprise value, debt paydown, sponsor proceeds, MOIC, and five-year IRR.
Show sensitivity to the exit multiple.

Use the illustrative inputs below to demonstrate the mechanics. Assume no transaction fees, dividends, management rollover, or minimum cash requirement.

Your question is Basic LBO. Take a moment with it on the right.

Talk me through your thinking if you like. When you're confident, submit your answer and I'll grade it like a real screen (7/10 or better passes).

Walk through a basic paper LBO (leveraged buyout). Asked in the First Round stage. PJT M&A (Strategic Advisory) first round interview.

Task

Calculate entry enterprise value, debt, and sponsor equity contribution.
Project exit enterprise value, debt paydown, sponsor proceeds, MOIC, and five-year IRR.
Show sensitivity to the exit multiple.

Use the illustrative inputs below to demonstrate the mechanics. Assume no transaction fees, dividends, management rollover, or minimum cash requirement.