This LBO exit strategy training will cover different ways a private equity firm can exit a leveraged buyout... <br />By http://breakingintowallstreet.com/ "Financial Modeling Training And Career Resources For Aspiring Investment Bankers" <br />... including an M&A deal – a sale to a normal company or to another private equity firm – as well as an initial public offering (IPO), and a recapitalization / perpetual dividend “non-exit.” <br /> <br />2:09 Exits in Real Life: M&A, IPO, and Dividends/Recaps <br />6:27 Standard M&A Exit in an LBO <br />7:21 IPO Exit in an LBO <br />12:44 Dividends / Recapitalization in an LBO <br />16:42 Recap and Summary <br /> <br />Exit Strategies in a Leveraged Buyout / LBO Model <br /> <br />There is typically VERY little thought given to the exit in a leveraged buyout (LBO) model – in 99% of models, people just assume a simple exit multiple based on EBITDA, implying that another company or another private equity firm buys the company. <br /> <br />But in real life, that doesn’t necessarily happen… sometimes, a portfolio company cannot be sold to another normal company or even to another private equity firm. <br /> <br />For example, it might be too big for another company to buy, or it might be in an unfavorable market where there’s little M&A activity. <br /> <br />Also, it tends to be harder to do M&A deals in emerging and frontier markets because potential buyers are also smaller and less willing to make big acquisitions. <br /> <br />As a result, you need to think about 2 alternative exit strategies: initial public offerings (IPOs) and recapitalizations (recaps), otherwise known as dividends / dividend recaps. <br /> <br />http://www.mergersandinquisitions.com/
