Not logged in.
Quick Search - Contribution
Contribution Details
| Type | Book Chapter |
| Scope | Discipline-based scholarship |
| Title | LBO Valuation Using Flows-to-Equity |
| Organization Unit | |
| Authors |
|
| Editors |
|
| Item Subtype | Original Work |
| Refereed | Yes |
| Status | Published in final form |
| Language |
|
| Booktitle | The Palgrave Encyclopedia of Private Equity |
| ISBN | 9783030387389 |
| Place of Publication | Cham |
| Publisher | Palgrave Macmillan |
| Page Range | 153 |
| Date | 2023-10-11 |
| Abstract Text | The flows-to-equity method is commonly used in leveraged buyouts and other highly leveraged transactions. These flows are hybrid flows, mixing expected operating cash flows with promised debt payments under a planned debt schedule. Because of this, it is difficult to accurately estimate the appropriate discount rate, a difficulty that is compounded by the typically changing leverage over time under the planned debt schedule. We show how the flows-to-equity approach works and discuss its benefits and drawbacks as compared with other, “more standard” methods. |
| Free access at | Official URL |
| Digital Object Identifier | 10.1007/978-3-030-38738-9_153-1 |
| Other Identification Number | merlin-id:24170 |
| PDF File |
Download from ZORA
|
| Export |
BibTeX
EP3 XML (ZORA)
|
| Keywords | Discount rate, Equity free cash flows, Hybrid flows, LBO modeling, Leverage |