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Public Course

M&A Analysis Fundamentals and LBO Analysis Fundamentals

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  • What you'll learn
  • Course Information
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  • What you'll learn
  • M&A Analysis Fundamentals

    This session covers the basic steps of analyzing an acquisition - covering the impact of a deal on the financial statements with a particular focus on EPS, PE and contribution analysis. By the end of the session, the class builds an accretion / dilution model using EPS forecasts and acquisition assumptions, proforma leverage ratios and a proforma balance sheet.

    Learning outcomes

    • Big picture: what is the transaction impact on acquirer and target shareholders?
    • Preparing key acquisition data
    • Building a flexible funding structure
    • Modeling acquisition adjustments
    • Calculating the accretion/dilution effects of the deal
    • Understanding the significance of relative P/Es
    • Calculating and understanding contribution analysis
    • Ownership issues
    • Income statement contribution
    • Credit issues and leverage ratios
    • The strategic implication of different financing alternatives
    • Synergies and synergies needed to break even
    • Proforma balance sheet
    • Sensitivity and scenario analysis

     LBO Analysis Fundamentals

    Participants are introduced to the basic concepts underlying leveraged buyouts. The session starts by establishing why private equity firms can create value through leveraged buyouts and how the levered valuation fits into the valuation roadmap. Using a simple free cash flow forecast, participants establish how much a financial buyer could pay for the target company. Participants then build a simple LBO model.

    Learning outcomes

    • What an LBO is and how it can create value
    • LBO valuation as an alternative valuation methodology
    • Characteristics of suitable LBO candidates
    • Estimating cash flows available to capital holders
    • Estimating debt capacity
    • Simplified debt / equity split for entry capital structure
    • Sources and uses of funds
    • Debt structure
    • Estimating the exit value
    • Calculating the IRR
    • Sensitizing the model
  • Course Information
  • 9.00am - 5.00pm EST

    1 day (non-exam)

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    Pre-Requisites

    Who should attend?

    New hires who have joined the firm late and missed the in-house program

    Individuals looking to fill a knowledge gap

    Experienced bankers looking to refresh their technical skills

    Teams employed in financial strategy roles from non-banking corporations

    Graduates preparing to interview for a role in the finance sector

    Students at business school and looking for a career in finance

    What to use

    You need to use a Windows-based laptop for the training with Excel and Adobe installed on your system to access your course files. Our teaching materials are designed for PCs and not MAC based systems. Download details for the necessary files will be emailed a few days before the course. You can use any version of MS Excel in class. Please inform us of your Excel version when booking your course.

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