Christoph Hinkelmann, Thesis Supervisor Brian Spangler Davis, Thesis Honors Advisor
Keywords:
Leveraged Buyout Private Equity Finance Financial Model IRR MOIC
Abstract:
This paper seeks to analyze the primary return drivers of leveraged buyouts through the use of a leveraged buyout analysis model. While there is extensive research regarding the primary factors that drive returns in leveraged buyouts, there are few in-depth case studies that analyze return drivers using a financial model. As a result, to better understand how value can be created in private equity deals, a leveraged buyout analysis model is used to analyze a large-scale club deal and determine the financial scenarios in which a gross internal rate of return (IRR) of 20% and a gross multiple of invested capital (MOIC) of 2.0x is achieved for the private equity consortium.