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Investment Banking: Valuation, Leveraged Buyouts, and Mergers and Acquisitions

Investment Banking: Valuation, Leveraged Buyouts, and Mergers and Acquisitions

Joshua Rosenbaum, Joshua Pearl, Joseph R. Perella (Foreword by)

ISBN: 978-0-470-44220-3

May 2009

336 pages


In the constantly evolving world of finance, a solid technical foundation is an essential tool for success. Due to the fast-paced nature of this world, however, no one has been able to take the time to properly codify the lifeblood of the corporate financier’s work—namely, valuation. Rosenbaum and Pearl have responded to this need by writing the book that they wish had existed when they were trying to break into Wall Street.

Investment Banking: Valuation, Leveraged Buyouts, and Mergers & Acquisitions is a highly accessible and authoritative book that focuses on the primary valuation methodologies currently used on Wall Street—comparable companies, precedent transactions, DCF, and LBO analysis. These methodologies are used to determine valuation for public and private companies within the context of M&A transactions, LBOs, IPOs, restructurings, and investment decisions. Using a step-by-step how-to approach for each methodology, the authors build a chronological knowledge base and define key terms, financial concepts, and processes throughout the book. They also provide a comprehensive overview of the fundamentals of LBOs and an organized M&A sale process.

In the aftermath of the subprime mortgage crisis and ensuing credit crunch, the world of finance is returning to the fundamentals of valuation and critical due diligence. This involves the use of more realistic assumptions governing approach to risk as well as a wide range of value drivers. While valuation has always involved a great deal of “art” in addition to time-tested “science,” the artistry is perpetually evolving in accordance with market developments and conditions. In this sense, this book is particularly topical—in addition to detailing the technical fundamentals behind valuation, the authors infuse practical judgment skills and perspective to help guide the science.

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About the Authors.



Supplemental Materials.


Structure of the Book.

ValueCo Summary Financial Information.

PART ONE Valuation.

CHAPTER 1 Comparable Companies Analysis.

CHAPTER 2 Precedent Transactions Analysis.

CHAPTER 3 Discounted Cash Flow Analysis.

PART TWO Leveraged Buyouts.

CHAPTER 4 Leveraged Buyouts.

CHAPTER 5 LBO Analysis.

PART THREE Mergers & Acquisitions.

CHAPTER 6 M&A Sale Process.

Bibliography and Recommended Reading.


Written by two practitioners with a combined banking experience of over 15 years, this text provides a practical, hands-on approach to valuation.