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Erudite AfricaCenter of Excellence
← Leveraged Buyout (LBO) Modeling

Exit, returns and advanced debt structures

Module 03 / 5 · 70 min

Value the exit, compute and attribute IRR and MOIC, test their sensitivity, then build the multi-tranche structure of the capstone deal with PIK mezzanine, a revolver, amortization profiles and covenant tests.

In this module you will learn to

  • Compute exit equity value, IRR and money multiple, and explain when each can mislead
  • Build a sensitivity table of returns to entry multiple, exit multiple and leverage
  • Attribute equity gains to EBITDA growth, multiple change and deleveraging
  • Model multiple tranches with PIK interest, a revolver and different amortization profiles
  • Test maintenance covenants year by year and measure headroom

Built on

  • Erudite Africa training module: Ethiopian Context, topic 3.b Leveraged Buyout (LBO) Modeling, Levels 1 and 2 (October 2026)
  • NBE Directives SBB/87/2024, SBB/92/2024, SBB/95/2025, NBE/INT/13/2026, FXD/01/2024 and FXD/04/2026, and NBE Monetary Policy Committee release No. 7 (July 2026)
  • Investment Proclamation No. 1180/2020, Investment Regulation No. 474/2020 and Ethiopian Investment Board Directive No. 1082/2025
  • Income Tax Proclamation No. 979/2016 as amended by No. 1395/2025, and Ministry of Finance Transfer Pricing Directive No. 981/2024
  • Ethiopia's Commercial Code and trade competition law, described without article references pending confirmation of the official texts

Examples and companies are fictional. Bank practices are shown as typical Ethiopian practice, not as any one bank's policy. Always apply your own institution's approved policy and the current NBE directives.