LBO Modeling

Learn how to structure an LBO and model the impact of the new financing structure. The focus of this course is to build out a full integrated model with an income statement, balance sheet and cash flow statement, together with a detailed analysis of the financing structures and returns

View video to get a brief overview of the course

What do you get on this course?


  • Build a detailed Sources & Uses table, including target cash, shareholder loan note and fees
  • How to build the initial balance sheet post buy out
  • How to forecast the income statement, balance sheet and cash flow, incorporating a detailed cash sweep / cash waterfall
  • How to calculate returns to all investors participating in equity, including the financial sponsor, management team, and mezzanine investors
  • How to build data tables to sensitize key outputs

key Topics

Complete topics step by step or jump to any of the below at any time.

  • Model overview
    • Sources and uses of funds at entry
    • Operating forecast
    • Distribution of proceeds at exit
    • Returns analysis
  • Sources and uses of funds at entry
    • Sources and uses of funds table
    • Ownership structure: Equity ownership at entry vs exit
    • Common equity (Sponsor and Management)
    • The use of different types of equity: Shareholder loan (PIK interest) and preferred stock
    • The use of different types of debt: term loans, subordinated debt, high yield, mezzanine (with PIK and cash interest)
  • Operating forecast
    • Creating the opening balance sheet
      • Deal goodwill
      • Deal adjustments, including amortization of debt issuance fees
    • Focus on cash flow drivers and sanity-checking preliminary assumptions
    • Cash flows available for debt servicing
    • Repayment schedules for individual debt instruments
    • Acceleration of debt payments using a cash sweep mechanism
    • Modeling the revolving credit facility
    • Circularities and the interest calculations
    • PIK interest
    • Credit ratios
    • Using the model outputs to identify key debt covenants
  • Distribution of proceeds at exit
    • Benefit of modeling out value to all investors at exit
  • Returns
    • Calculation and interpretation of returns to the equity investors
    • Calculation and interpretation of returns to mezzanine investors
    • Calculation and interpretation of returns to the management team
    • IRR and money multiple
    • Sensitizing the outputs of the analysis
    • Analysis of the output

Having trouble deciding? Check out AMT Training’s latest online financial courses.

10.5 hours of video content

Estimated 21 hours to complete.

How to access your course

  • Checkout and pay for the course(s).
  • Your course(s) will be added to your DELTA account.
  • You will then receive an email with joining instructions.
  • You will have 12 months access from date of purchase.


This course is open to all. To maximize the benefit of this course we recommend an understanding of financial statements and Microsoft Excel.

Technical Requirements

You will need an Internet connected device to access the videos and download supporting resources. Supporting resources can be used offline, which require Microsoft Excel 2003 or later and a PDF reader.

Comprehensive Resources

You’ll be able to easily access all of the materials you need through our learning management system DELTA

  • Bite-size trainer led HD videos detailing step by step techniques and best practices.
  • Download the slides and files as used in the videos, which can be completed while watching or saved for later.
  • Open forum for quick problem solving.

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