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This is a two-part course focusing on LBO Analysis Fundamentals and LBO Modeling.

6.5 hours of video content.
Estimated 13 hours to complete.


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


LBO Anlaysis Fundamentals:

Learn how financial sponsors select appropriate target businesses, the typical funding structures they use to acquire these target businesses and the way they generate a return, or IRR for their investors through a sale or ‘exit’ at the end of the LBO.


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


LBO Analysis Fundamentals:

  • Define an LBO transaction
  • Understand the funding structure of an LBO
  • Identify the process of the subordination of debt within an LBO funding structure
  • Build an LBO model in Excel for any cash-generating business

LBO Modeling:

  • 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



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

LBO Analysis Fundamentals:

  • LBO valuation
  • Financing structure
  • Senior secured debt
  • Senior unsecured debt
  • Subordinated debt
  • Equity financing
  • Debt push down
  • IRR

LBO Modeling:

  • 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
    • 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

**Training The Street acquired AMT Training in 2021. We have merged AMT's products into one store, to increase our content offering.**

Save money with this course by purchasing our bundle!

This course is available in the:
Essentials 10 Courses Bundle - Valuation, Modeling and Origination.

Save up to 57% on all courses with this bundle!
The bundle includes the following courses:

  • Financial Statement Analysis
  • Excel Best Practices for PC: Become an Excel Expert
  • Financial Modeling: Building a Complete Model in Excel
  • Corporate Valuation: How to Value Companies and Mergers
  • Merger Modeling: How to build an M&A Model in Excel
  • LBO Modeling: Building an LBO Model in Excel
  • Capital Markets and Corporate Funding
  • Debt Captial Markets
  • Equity Capital Markets
  • Applied Excel: Working with Data Sets and Scenario Analysis

Group Orders

We offer discounts for group orders on our self-study products. Group orders are an attractive option for companies or teams looking to upskill together.

Contact us at to learn more about how to save money on group orders.

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Gain your recognition with our digital certificates

Training The Street has been teaching the biggest finance firms for over 20 years. To help unlock your career potential, we offer certificates to provide the recognition you deserve.

After you finish your course, you will receive a certificate which can be easily added to your LinkedIn profile.