Analyzing Debt Capacity And Structure

Evaluates target leverage capacity with cash flow coverage, stress testing, and optimal debt structure across term loans, revolver, and mezzanine.

When To Use

• Sizing acquisition debt for an LBO or growth equity recapitalization
• Evaluating how much leverage a target's cash flows can support under base and downside scenarios
• Structuring a multi-tranche debt package (senior term loan, revolver, second lien, mezzanine/sub debt)
• Stress testing an existing or proposed capital structure against covenant thresholds
• Preparing debt-capacity sections for investment committee memos or lender presentations

Inputs To Gather