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    Stand-Alone Valuation (Dollars in Millions) : PPG Industries Metric Actual Projected 2011 2012E 2013E

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    Stefanny cardona
    This document presents a stand-alone valuation and leveraged buyout (LBO) analysis of DuPont Performance Coatings (DPC). Key metrics such as sales growth, EBITDA margins, and multiples are forecasted through 2016. An APV model is used to calculate the enterprise value of DPC as a stand-alone business at $4.518 billion. The LBO analysis then assumes 6x debt to EBITDA leverage at a 6.75% interest rate to calculate an implied purchase price of $3.926-$4.025 billion, leaving room for profit. However, risks include higher debt levels and dependence on projected financial performance.

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    Stand-Alone Valuation (Dollars in Millions) : PPG Industries Metric Actual Projected 2011 2012E 2013E

    Uploaded by

    Stefanny cardona
    95 views4 pages
    This document presents a stand-alone valuation and leveraged buyout (LBO) analysis of DuPont Performance Coatings (DPC). Key metrics such as sales growth, EBITDA margins, and multiples are forecasted through 2016. An APV model is used to calculate the enterprise value of DPC as a stand-alone business at $4.518 billion. The LBO analysis then assumes 6x debt to EBITDA leverage at a 6.75% interest rate to calculate an implied purchase price of $3.926-$4.025 billion, leaving room for profit. However, risks include higher debt levels and dependence on projected financial performance.

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    Caso Dupont excel

    Original Title

    Caso Dupont Excel

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    This document presents a stand-alone valuation and leveraged buyout (LBO) analysis of DuPont Performance Coatings (DPC). Key metrics such as sales growth, EBITDA margins, and multiples are forecasted through 2016. An APV model is used to calculate the enterprise value of DPC as a stand-alone business at $4.518 billion. The LBO analysis then assumes 6x debt to EBITDA leverage at a 6.75% interest rate to calculate an implied purchase price of $3.926-$4.025 billion, leaving room for profit. However, risks include higher debt levels and dependence on projected financial performance.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    95 views4 pages

    Stand-Alone Valuation (Dollars in Millions) : PPG Industries Metric Actual Projected 2011 2012E 2013E

    Uploaded by

    Stefanny cardona
    This document presents a stand-alone valuation and leveraged buyout (LBO) analysis of DuPont Performance Coatings (DPC). Key metrics such as sales growth, EBITDA margins, and multiples are forecasted through 2016. An APV model is used to calculate the enterprise value of DPC as a stand-alone business at $4.518 billion. The LBO analysis then assumes 6x debt to EBITDA leverage at a 6.75% interest rate to calculate an implied purchase price of $3.926-$4.025 billion, leaving room for profit. However, risks include higher debt levels and dependence on projected financial performance.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    of 4

    Stand-Alone Valuation

    (dollars in millions)
    PPG Industries
    Metric Actual Projected
    2011 2012E 2013E
    Crecimiento de las Ventas 10.9% 4.1% 4.3%
    Margen EBIT antes de impuestos 11.2% 11.0% 12.0%
    EV/EBITDA 2012 (×) 7.3

    DuPont Performance Coatings


    Metric Projected
    Closing
    2011A 2012E 2013E 2014E
    Crecimiento de las Ventas 12.5% 5.0% 5.0% 5.0%
    Depreciacion y Amortizacion $104 $115 $118 $122
    Margen EBIT antes de impuestos 6.3% 12.0% 12.0% 12.0%
    Tasa de Impuestos 25% 25% 25% 25%
    Gastos de Capital $80 $115 $122 $132
    Capital de Trabajo Neto 15.0% 15.0% 15.0%

    Multiplo EBIT (×) 2


    Debt/EBITDA 2012 (×) N/A
    Debt
    Tasa de Interes Combinada sobre
    Deuda
    6.75%
    Costo de Capital no Apalancado 11.2%

    APV Analysis
    2011A Closing 2012E 2013E 2014E
    Ventas Netas $4,281 $4,495 $4,281 $4,506
    EBITDA $372 $654 $632 $663
    Depreciacion y Amortizacion. $104 $115 $118 $122
    Ingresos Operativos antes de Impues $268 $539 $514 $541
    Gastos por Intereses $0 $0 $0
    Ganancias Antes de Impuestos $539 $514 $541
    Impuestos ($135) ($128) ($135)
    Ingresos Netos $405 $385 $406
    Aumento del Capital de Trabajo Neto ($32) $32 ($34)
    Gastos de Capital ($115) ($122) ($132)
    Flujo de Caja Residual (Apalancado) $372 $413 $362

    Flujo de caja libre sin


    apalancamiento $372 $413 $362
    Valor Terminal
    FCF sin apalancamiento, incluida la
    TV $372 $413 $362

    Valor empresarial (EV) $4,518

    Escudo de impuestos sobre


    intereses

    Escudo fiscal PV
    EV Escudo Fiscal
    Escudo fiscal PV $4,518

    Deuda 6 Forward de Ebitda 6 6 6


    Valor Deuda 3,926 3,790 3,976

                                                                  i.      ¿Cuáles son las ventajas y riesgos de este LBO?

    Data sources: Historical information for DPC is from DuPont company Databooks. Projections are case writer estimates. PPG’s
    enterprise value is based on prices at the end of January 2012. PPG’s projections are based on Buckingham Research Group analyst
    report, PPG Industries: “Other” Industrial Coatings Review, May 21, 2012.
     
    Notes to stand-alone model:
    1
    DPC’s estimated average tax rate of 25% is lower than the U.S. marginal corporate tax rate as a result of international operations taxe
    at lower rates.
    2
    Assumed forward exit multiple for Terminal Value is based on projected EBITDA growth in 2017 and is below PPG’s multiple becau
    of lower margins and slightly lower growth.
    3
    Unlevered Cost of Equity (ku) is based on PPG’s estimated unlevered beta of 1.2, a normalized 4% long-term U.S. Treasury rate, and
    6% market risk premium.
    Projected
    2015E 2016E
    5.0% 5.0%
    $125 $130
    12.0% 12.0%
    25% 25%
    $144 $150
    15.0% 15.0%

    7.5

    2015E 2016E
    $4,495 $4,506
    $664 $671
    $125 $130
    $539 $541
    $0 $0
    $539 $541
    ($135) ($135)
    $405 $406
    $2 ($2)
    ($144) ($150)
    $387 $384

    $387 $384
    $5,282
    $387 $5,666

    6 6
    3,986 4,025

    case writer estimates. PPG’s


    kingham Research Group analyst

    esult of international operations taxed

    and is below PPG’s multiple because

    % long-term U.S. Treasury rate, and a

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