Uses data on post-LBO forecasts of the balance sheet, and on the post-LBO valuation of company Y

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Uses data on post-LBO forecasts of the balance sheet, and on the post-LBO valuation of company Y

Cash flows						Balance Sheet
	2021 Dec	2022 Dec	2023 Dec	2024 Dec			Dec-20	Dec-21	Dec-22	Dec-23	Dec-24
EBITDA	2866	2981	3100	3224		Cash and ST Investments	895	1405	1880	2684	3706
Capital expenditures	-1090	-1220	-989	-875		Receivables and Inventory	3256	3309	3364	3422	3481
Change in NWC	-53	-55	-57	-60		Current Assets	4151	4714	5244	6106	7187
Taxes	-373	-370	-443	-493		Net Property, Plant and Equipment	7356	7666	8075	8220	8218
Cash flows	1350	1336	1610	1796		Non-current Assets	7356	7666	8075	8220	8218
Discounted cash flow	1224.121	1098.1	1200.1	1213.514		Total Assets	11507	12380	13319	14326	15405
Terminal value				22073
	2020 Dec
Firm (enterprise) value	19649
Total debt	18675
Cash	895
Equity value	1869

WACC	10.3%	0.103
Long-term growth	2.0%

The private equity fund is planning to invest 2000 in cash in this deal in December 2020.

a) What is the NPV of the deal for the private equity fund in Dec 2020?

b) What is the IRR of the deal, if the PE fund exits in 2024? Assume no cash payouts between 2020 and 2024.

Related Book For answer-question

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Financial Reporting Financial Statement Analysis and Valuation

Financial Reporting Financial Statement Analysis and Valuation

ISBN: 978-0324302950

6th edition

Authors: Clyde P. Stickney

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Posted Date: Jan 26, 2024 11:19 PM

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