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AutoDrive Inc., a company specializing in autonomous driving technology, is the target of a leveraged buyout by Alpha Investments, a private equity firm. Alpha is

AutoDrive Inc., a company specializing in autonomous driving technology, is the target of a leveraged buyout by Alpha Investments, a private equity firm. Alpha is acquiring AutoDrive on a cash-free, debt-free basis for a total enterprise value of 10.0x the companys 2023 projected EBITDA of $90 million. Alpha plans to finance the acquisition with $500 million of new debt and new equity from funds managed by the firm. The existing management team of AutoDrive is rolling over a portion of their equity proceeds into the deal so that they have 25% pro forma ownership.
Assuming that AutoDrive has no existing debt and no excess cash on its balance sheet at close, and $10 million of transaction-related expenses, what is the size of the equity check that Alpha Investments needs to write to finance this LBO transaction?
A)$102.5 million
B)$150.0 million
C)$300.0 million
D)$307.5 million

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