Has anyone done an LBO or all debt deal with no equity?

April 10, 2020
by a searcher in Florida, USA
In the case of a target with high FCF and high debt service coverage with very attractive EBITDA multiples, an all debt deal seems the way to go, but am having trouble with capital structure. Am seeking Mezz Debt to cover 30% of TEV or some alternative. What would you do?
from University of Pennsylvania in Chicago, IL, USA
from Illinois Institute of Technology in Pasadena, CA, USA
(1) AB loan since the target was capital equipment heavy plus draw down on A/R line,
(2) seller notes next tranche, followed by
(3) above-market comp for one of three retained owners who stayed on as president
(4) consulting contracts for other 2 exiting owners, and finally
(5) covenant not to compete for all three selling shareholders.
There were obvious, ordinary income tax costs to the sellers, but they accepted the deal.