Question
What are the three main drivers of returns in an LBO?
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Answer
Earnings growth, multiple expansion, and debt paydown.
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Question
Why are mature companies with stable cash flows typical LBO targets?
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Answer
Stable cash flows can support heavy debt financing.
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Question
What distinguishes unitranche debt from separate senior and subordinated loans?
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Answer
It blends them into one loan with combined pricing.
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Question
A PE-owned company is sold to another buyout fund rather than to a corporation. What exit route is this?
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Answer
Secondary sale.
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