The private equity firm reviewing this deal believes that it can
achieve this 30%+ IRR because of the company’s strong EBITDA and
FCF growth and the fact that the ROIC nearly triples, even as the
revenue and EBITDA growth rates slow down by the end.
Also, it argues that since 49% of the returns come from EBITDA Growth, with only 26% from Multiple Expansion, the assumptions are not overly aggressive. What is the biggest POTENTIAL PROBLEM with these arguments?