Module IV· Sources & UsesBasic
Question
What is the typical equity share in a buyout today?
Answer
Current market range
35–50% of Total Uses, depending on sector and cash-flow stability.
| Sector / profile | Equity share |
|---|---|
| Stable (healthcare, software, infra) | 30–40% |
| Middle-market industrials | 40–50% |
| Cyclical (consumer goods, construction) | 50%+ |
Consequence
Pre-2008, equity shares were 20–30% (leverage 6–7x EBITDA). After the financial crisis + Basel III, permanently higher.
Pitch tip
Middle-market 2024/25: Senior Debt 4.5–5.5x EBITDA, total leverage rarely >6x without mezz.