Main  /  Members  /  Demo Company  /  LBO Scenario #1a, Case 1
Step 1. Review / change case valuation criteria.  
  a. The amount of the selling price the seller is willing to finance (dollars in thousands) $   
  b. The annual rate of return on equity investment (ROR) objective of the buyer
(an ROR objective between 20% and 40% is customary)
  c. Your estimate of the EBITDA multiple to be used to determine the selling price of the business at the end of the buyer's four years of ownership (an EBITDA multiple estimate between 5.0 and 8.0 is customary)      
  d. Your estimate of interest rates to be paid on senior (bank) debt and subordinated debt:  
  Senior (bank) debt   %
  Subordinated debt (annual "current pay" rates between 8% and 12% are customary)   %
Step 2. Save changed estimates and re-calculate the LBO Case valuation
Step 3. Review estimated LBO Case valuation at end of first forecast year. PDF HTML
  a. Review / print Estimated LBO Valuation - Summary HTML
  b. Review / print Income Statement   HTML
  c. Review / print Balance Sheet   HTML
  d. Review / print Cash Flow Statement   HTML
  e. Review / print Principal Assumptions/Relationships Report   HTML
  f. Review / print Financial Feasibility Report   HTML
  g. Review / print Financial Management Report   HTML