Description

A practical guide to leveraged buyouts built from first principles, using the real-world acquisitions of Hologic and Electronic Arts to explain how LBOs are structured, how leverage amplifies returns, and how to evaluate whether a deal actually makes financial sense.

Learning Objectives

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1. Determine what a leveraged buyout is and explain how leverage amplifies equity returns.
2. Identify the characteristics that make a business a suitable LBO candidate.
3. Explain how LBO transactions are financed using sources and uses of funds.
4. Differentiate between money multiple and IRR and explain why both metrics are needed to evaluate a deal.
5. Apply LBO analysis to real-world transactions including entry multiples, debt structure, and return calculations.