Leveraged Buyout (LBO) Definition: How It Works, with Example
A leveraged buyout (LBO) is the acquisition of another company using a significant amount of borrowed money (bonds or loans) to meet the cost of acquisition. The assets of the company being acquired are often used as collateral for the loans, along with the assets of the acquiring company.A leveraged buyout (LBO) occurs when the acquisition of another company is completed almost entirely with borrowed funds.Leveraged buyouts declined in popularity after the 2008 financial crisis, but they are...
Leveraged Buyout (LBO) Definition: How It Works, with Example
A leveraged buyout (LBO) is the acquisition of another company using a significant amount of borrowed money (bonds or loans) to meet the cost of acquisition. The assets of the company being acquired are often used as collateral for the loans, along with the assets of the acquiring company.A leveraged buyout (LBO) occurs when the acquisition of another company is completed almost entirely with borrowed funds.Leveraged buyouts declined in popularity after the 2008 financial crisis, but they are...
