Question
Amazon completed the leveraged buyout acquisition of Regal paying an EV/EBITDA multiple equal to 7.0x and a total equity contribution of $200. Amazon expects to
Amazon completed the leveraged buyout acquisition of Regal paying an EV/EBITDA multiple equal to 7.0x and a total equity contribution of $200.
Amazon expects to sell Regal in 5 years with a 7.5x EBITDA exit multiple, with expected EBITDA of $120 and net debt (i.e., debt - cash) of $550 in year 5.
What is the expected IRR of this deal?
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Microeconomics
Authors: Douglas Bernheim, Michael Whinston
2nd edition
73375853, 978-0073375854
