Debt in private equity deals: a role play

Internet publication

This case presents the financial and operational situation of a company subject to a Management Buy-In. Students can be divided between lenders (Banks, or Private Debt firms) and borrowers (Private Equity firms) and discuss the appropriate capital structure for the target company. In doing so, students are expected to become fluent in the language of leveraged finance, and to learn by doing the logic behind the choice of debt quantum, structure, price (yield) and covenants.

Authors: Phalippou, L

• Publication status: Published
• Peer review status: Not peer reviewed
• Host title: SSRN
• Publication date: 2023-04-17
• DOI: 10.2139/ssrn.4408204
• EISSN: 1556-5068
• Language: English
• Keywords: mezzanine; capital structure; term loans; credit committees; management buy-in; negotiation dynamics; debt pricing; senior and junior debt; debt capacity; debt covenants