Courses / Leveraged Buyouts (Standard) / How Equity Investors Make Money from LBO Upgrade AccountYour current access is limited. To continue watching this lesson, you'll need to purchase a subscription. Sign UpHow Equity Investors Make Money from LBOEquity investors make money when the value entitled to them increase over time. In this lesson, we investigate the levers that need to change in order to increase Equity Value.DiscussionRestricted AccessYou need to sign up for a Lumovest subscription in order to join discussions. Sign UpRestricted AccessYou need to sign up for a Lumovest subscription in order to to download lesson materials. Sign UpLeveraged Buyouts (Standard) 1. What is a Leveraged Buyout (LBO)? (3:51) 2. Why Private Equity Firms Use Leverage (4:25) 3. Why the Use of Leverage Boosts Equity Returns (8:17) 4. How Equity Investors Make Money from LBO (2:58) 5. How a LBO Model Works (2:25) 6. Modeling the Entry Valuation (8:40) 7. Financing Fees (2:05) 8. Amortization of Financing Fees (3:29) 9. Modeling the Capital Structure Table (12:29) 10. Modeling LBO Sources & Uses (6:43) 11. Modeling LFCF Projections (7:56) 12. Introduction to Debt Schedule (3:50) 13. Cash Available to Optionally Repay Debt (3:56) 14. Modeling Cash Available to Optionally Repay Debt (4:55) 15. Modeling the Benchmark Rate (2:24) 16. Order Matters in Debt Schedule (1:17) 17. Modeling Revolver in Debt Schedule (10:42) 18. Modeling Term Loan in Debt Schedule (10:34) 19. Modeling Bond in Debt Schedule (2:16) 20. Significance of Positive vs. Negative LFCF (3:06) 21. Net Debt (1:05) 22. Modeling the Capital Structure (5:49) 23. Modeling the Integration of Financials (3:42) 24. Circularity in the Debt Schedule (2:15) 25. Circular Reference Error (5:30) 26. Modeling the Circularity Protection (2:30) 27. Modeling the Returns Profile (3:54) 28. Cost of Capital in LBO (2:21) 29. Drivers of IRR in LBO (4:15) 30. Connecting Dots (2:16)
