TeddieMao
  • TeddieMao
I am looking for study information on how a sale leaseback is structured.
Finance
schrodinger
  • schrodinger
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anonymous
  • anonymous
A sale leaseback is very simple to analyze and there is little that additional study can bring to the analysis. The sale creates a cash inflow and the leasing back the asset creates cash outflows. If the present value of the cash outflows is less than the cash inflow, the sale lease back makes sense. The only mechanical issue is the discount rate to use to discount lease payments - I would use the pre-tax cost of debt.

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