Leveraged Buyout (LBO) Modeling: Sources and Uses by Corporate Finance Institute

Course details

A leveraged buyout (LBO) model is one of the most widely used tools in investment banking and private equity. This course helps you to develop a strong foundation in how LBO transactions are structured and financed. Learn how to construct sources and uses of funds, determine purchase price using enterprise value and EBITDA multiples, and analyze financing assumptions across different types of capital. Get introduced to key valuation concepts and the capital structure used in LBO transactions. By the end of this course, you’ll have foundational knowledge of how transactions are structured, valued, and financed so you can progress toward building a complete LBO model.

Concepts

Introduction

Introduction

Leveraged Buyout (LBO) Overview

Strategic vs. financial buyers
Leveraged buyout (LBO) candidates
Benefits and risks of LBOs

LBO Valuation

Enterprise value
Normalized and growing EBITDA
Exit strategies
Return drivers

LBO Model Design

LBO model design
Cover page
LBO model tour

Sources and Uses

Purchase price
Capital structure
Sources and uses overview
Purchase price overview
Purchase price complete
Uses and sources overview
Uses and sources complete

Financing Assumptions

Financing assumptions
Transaction tab assignment
Transaction tab complete
Financing assumptions review

Model Drivers

Model drivers introduction
Model drivers assignment
Model drivers complete
Inserting sparklines
Using combo boxes

Conclusion

Course summary