Private Equity

Lecture 9 - 10: LBO Model, EV to Equity and Exit

Comprehensive quiz covering LBO model construction, types of EBITDA, value creation strategies, the EV-to-Equity bridge, net debt and working capital adjustments, completion mechanisms (locked box vs. completion accounts), governance, and exit routes.

Question 33 of 52

Which of the following are disadvantages of the locked box mechanism?

Select every statement that applies.

It involves a significant level of assumptions

It causes a delay in completion

It requires an increased level of SPA comfort, such as warranties and indemnities

It leaves significant room for post-completion dispute

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