The Art of the LBO NYU Stern School of Business（杠杆收购纽约大学斯特恩商学院的艺术）.pdf

The Art of the LBO November 2004 Agenda I. An Overview of Leveraged Buyouts II. The Building Blocks III. Putting It All Together IV. How It Happens in Reality 2 1 I. An Overview of Leveraged Buyouts What Are LBOs? What Is an LBO? A Leveraged BuyOut is the acquisition of an entire Company or division n Buyer (the “Sponsor”) raises debt and equity to acquire Target Borrows majority of purchase price Contributes proportionately small equity investment n Buyer grows Company, improves performance Relies on Company’s free cash flow and asset sales to repay debt Potentially makes add-on acquisitions Later sells or IPOs all or a portion of the Company to exit investment 4 2 What Is An LBO? Typical Leveraged Buyout Structure Current Acquiror Owners Purchase Equity (LBO Firm) Price Investment NewCo Bondholders High Yield (Merged Into Bank Banks Bonds Loan Target) Target 5 More Common Than You Think… Some prominent LBOs: Company Sponsor Size Silver Lake $2.0bn TPG, Bain GS $1.6bn Madison Dearborn Partners $1.5bn KKR $1.5bn