Exercise I Basic understanding of the capital structure and seniority of different securities
Company ABC has been going through very rough time Because of the economic downturn, ABC has lost major clients and can not serve its debt any more and is going through a liquidation process by way of a sale
Here is an overview of the capital structure of ABC: Subordinated bond
Senior subordinated loan
Senior, unsecured loan
ABC’s stakeholders found a buyer, company XYZ. The deal is closed at a valuation of 10.0x EBITDA of £35m What is the Equity value of the company, assuming there is no accrued interests?
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Published on Mar 12, 2014