Identify key business elements that may impact valuation

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Reference no: EM133159340

The topic related to Private Equity and Venture Capital.

Question 1. What were the main strengths and weaknesses of Bartok's business? What were the sources of potential upside for Warburg Pincus?

Question 2. Based on Exhibit 3, assess whether the asking 8.5X EBITDA multiple for Bartok is reasonable.

Question 3. Using management's projections, construct a basic LBO model and compute the expected money multiples (show calculations in the appendix on the last page). Assume the following:
- Two exit scenarios - in 2007 and 2009
- Buying multiple is 8.5X EBITDA, 60% of enterprise value can be financed with debt, cost of debt is 15%, the rate is 35%, all intermediate cash flows are used to pay off debt

Identify the key business elements that may impact the valuation. What is your view on management's projections?

Question 4. If Warburg Pincus decides to execute the deal, what are the critical next steps that the firm should undertake in order to make the transaction successful?

Attachment:- Bartok Case.rar

Reference no: EM133159340

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