Customized LBO Template

CLIENT: Private Equity Firm

A US-based private equity firm approached Sapling to design and build a customized and reusable LBO template. The firm had previously been using and creating unique models for each deal they had, but wanted a model template which they could consistently use for upcoming deals, that could be easily updated and contain all the necessary calculations for the firm’s typical usage. Sapling also worked with the client after the model build process to help calibrate and further adjust the model to align with the client’s first deal.

3 Key Insights:

Sapling built a detailed 5-year LBO model template. A key feature is that the model is designed to take in historical data in either general ledger, trial balance, or just financial statement format, and then generate revenue, COGS and SG&A projections based off of either a yearly growth rate, monthly growth rate, percent of sales, or straight $ input approach, for high flexibility

The model also allows for assumptions around additional add-on acquisitions following the main acquisition at the start of the model term. The add-on acquisitions have key assumptions around purchase price, debt & equity funding, and growth

Key outputs of the model are detailed financial statements and expense breakdowns, shareholder return metrics, sources and uses detail, financial ratios, and many other critical metrics and outputs relevant for the firm’s use

EXAMPLE: Sources and Uses

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