how do different types of Debt and interest options affect the IRR? For example‚ does it benefit the PE firm to use a higher percentage of Term Loans or higher percentage of Senior or Subordinated Notes? What about cash vs. PIK interest?
a. Using a higher percentage of Term Loans typically lowers the cost of debt and can have a positive impact on IRR, as it reduces the overall interest expense for the PE firm.

b. Opting for a higher percentage of Senior Notes may provide a lower cost of debt compared to Subordinated Notes, leading to a higher IRR for the PE firm.

c. Utilizing cash interest payments instead of PIK interest can increase the cash flow available for distribution to the PE firm, potentially improving the IRR.

d. Balancing the use of different types of debt and interest options can help optimize the overall cost of capital and maximize the IRR for the PE firm.