A Valuation of the Leveraged Buyout of Staples Inc.

Anders Klug & Franziska Lea Kuder

Student thesis: Master thesis

Abstract

This thesis provides an analysis and evaluation of Sycamore Partners┬┤ leverage buyout of Staples Inc. The purpose of this evaluation is to assess whether or not Sycamore Partners paid an appropriate price given the leverage buyout of Staples Inc. The method of evaluating the leverage buyout included, a theoretical understanding of a leverage buyout, a fundamental and strategic analysis of Staples leading to a comprehensive valuation through various valuation methods. Other analysis included an understanding of Sycamore Partners and their previous investments. The different valuation methods applied included a comparable valuation, precedent valuation, leverage buyout valuation and an adjusted present value valuation. The evaluation of the acquisition price, through the different valuation methods, resulted in an overall assessment deeming the acquisition price as appropriate, given an exit year of 2024 and an IRR hurdle rate of 20%.

EducationsMSc in Finance and Investments, (Graduate Programme) Final Thesis
LanguageEnglish
Publication date2018
Number of pages148