Guided Walkthroughs
Paper LBO — Step 6 of 10: Run the sweep for all five years. How much debt is repaid, and what's left at exit?
Model answer
Pre-tax income each year = EBITDA − 20 D&A − 60 interest: 30 / 40 / 50 / 60 / 70. At 20% tax, FCF (= net income here) = 24 / 32 / 40 / 48 / 56. Cumulative paydown = 24 + 32 + 40 + 48 + 56 = $200M…
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