A small airline recently sold to a private equity group for $145 million.

profilejasperfork11
 (Not rated)
 (Not rated)
Chat

A small airline recently sold to a private equity group for $145 million. The airline has earned profits of $9 million last year. The new managers believe they can grow profits at 5% per year. The private equity group borrows money from wealthy individuals to invest in acquisitions. Because of the significant risk involved, lenders are promised a 12% return on their loans to the equity group. Is the purchase price of the new airline reasonable? Explain 

Additional Requirements 

Other Requirements: Please show work in excel file

    • 6 years ago
    A small airline recently sold to a private equity group for $145 million.
    NOT RATED

    Purchase the answer to view it

    • attachment
      airline.docx