Advanced Capital Structure Modeling

Description

This full-day advanced capital structure modeling seminar is a challenging session geared towards experienced investment banking analysts and associates. The goal of the session is to ensure that bankers are completely comfortable building complex debt concepts into a financial model. Assignments, handouts and examples will be used throughout the day.

Prerequisites

This course builds on "Capital Structure Modeling", so participants may want to complete that course prior to taking the "Advanced Capital Structure" session.

Time

8 hours

Learning Topics

Key Debt Concepts

Discuss key features and design considerations for complex pieces of debt
Learn to model a convertible bond
Incorporate Mezzanine debt with non-cash PIK interest that toggles based on the company’s leverage
Create a bridge loan for an M&A situation
Build in a flexible revolving credit facility with a cash sweep
Incorporate a minimum cash balance so that the cash account never drops to zero
Model various tranches of Senior Notes and Term Loans with various repayment mechanisms
Properly incorporate all the capital structure elements into the financial statements and balance the balance sheet

Model Circularity

Review circularity within financial models and learn to create a “circuit breaker” to fix a crashed model
Learn why models are often circular, and which pieces of debt contribute to the model’s circularity
Use the circular reference toolbar to identify inappropriate circular references