Build Leveraged Buyout Model - JCG

Overview This exercise guides you through building a LBO for J.Crew Group (JCG). This is an advanced LBO model that integrates multiple financial statements, debt schedules with multiple tranches, goodwill adjustments, and levered cash flow analysis. Learners are expected to link historical financials to projections, calculate IRR for equity investors, and manage a complex Sources & Uses structure. It is recommended for those already comfortable with basic LBO mechanics and intermediate financial modeling concepts. You will compute the Internal Rate of Return (IRR) based on a combination of Investor Equity and Debt. The exercise emphasizes understanding how transaction assumptions, historical financials, projected financials, debt schedules, and goodwill interact to produce equity returns. Learning Goals Master LBO mechanics: Input transaction assumptions, debt assumptions, and project Sources & Uses of funds (Sources & Uses) to understand deal structure. Project company performance: Complete Income Statement, Balance Sheet, and Cash Flow Statement projections (2012–2016) and calculate interest expense/income using debt schedules. Analyze investor returns: Compute exit value, equity value, and IRR, and understand the impact of assumptions on equity returns. Key Concepts EBITDA: Core profitability metric used to assess operational performance and debt capacity. Goodwill & Intangible Assets: Calculate when purchase price exceeds net identifiable assets (Goodwill Concept). Debt Schedule: Tracks principal, interest, and repayments over the investment period. Cash Flow Analysis: Includes free cash flow available for debt repayment and levered cash flows to equity investors. Internal Rate of Return (IRR): Annualized return on equity investors’ cash flows. MOIC (Multiple on Invested Capital): Total cash returned to investors relative to invested equity. Exit Valuation: Expected company sale value based on EBITDA multiples at exit. Sources of Funds & Uses of Funds: Capture how the transaction is financed and how proceeds are applied.

Practice Build Leveraged Buyout Model - JCG with interactive Excel modeling exercises in our LBO Modeling module.

This hands-on modeling exercise helps you master Build Leveraged Buyout Model - JCG through real-world Excel practice and financial modeling techniques.