Bank of America Investment Banking Pitch Book
Preliminary Valuation Considerations
Illustrative LBO Analysis - Pioneer Base Case
Sources and Uses ($14.50 Offer Price)
Sources
First Lien (L+350bps)
Second Lien (8.50%)
Equity Contribution
Total Sources
16
Uses
Equity Purchase
Refi. Pioneer Debt (Revolver)
Fees & Expenses
Total Uses
Exit
Multiple
IRR Sensitivity to Transaction Metrics
9.5x
Implied LTM 2014 Multiple
$255
110
325
$690
$11.00
$12.00
21.4%
$13.00
17.3%
7.5x 26.2%
8.0x 29.4% (24.5%) 20.3%
8.5x 32.4%
9.0x 35.2%
37.8%
23.0%
27.4%
30.1%
32.6%
25.8% €21.9%
28.1%
24.2%
8.4x
$
$477
195
18
$690
Offer Price Per Share
8.0x
8.4x
$14.00
13.8%
16.7%
19.4%
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8.9x
%
37%
16%
47%
100%
%
69%
28%
3%
100%
$15.00
10.8%
13.6%
18.2%
18.8%
20.9%
9.4x
PF Capitalization ($14.50 Offer Price)
Cash
Existing Pioneer Debt (Revolver)
New First Lien (L+350bps)
New Second Lien (8.50%)
Total Debt
Net Debt
Equity
Total Capitalization
2014E Adj. EBITDA (LTM 6/30)
Credit Statistics:
Total Debt / Adj. EBITDA
Net Debt / Adj. EBITDA
Status Quo
53
$195
$195
192
$259
$453
$69
2.8x
2.8
As of June 30, 2014
Adj.
($195)
255
110
Source: Pioneer Bosa Cosa as of April 9, 2014 and FactSet as of April 25, 2014.
Note: Dollars in milions. Assumes illustrative June 30, 2014 transaction close. Based on 31.921 million common shares outstanding. 2.837 million options at a strike price of $11.49 per share and 0.379 million RSUS, per Pioneer
Management, occounted for using the treasury stock method and as of March 31, 2014. Assumes Pioneer maintains minimum cash balance of $2.8 million, consistent with current cash balance. Assumes $7.3 million of
transaction fees, $11 million of financing fees.
Bank of America
Merrill Lynch
$4
Assumes elimination of public company
costs of $4 to $5 million per annum
during sponsor ownership
Pro Forma
53
255
110
$365
362
$318
$683
$73
(5.0x/
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