leveraged buyout

noun

1. the purchase of a company with borrowed money, using the company's assets as collateral, and often discharging the debt and realizing a profit by liquidating the company. : LBO

leveraged buyout

/ ˈliːvərɪdʒd /

noun

1. a takeover bid in which a small company makes use of its limited assets, and those of the usually larger target company, to raise the loans required to finance the takeover LBO

leveraged buyout

1. The purchase of a company mainly with borrowed money on the expectation that the purchaser can repay from the company's future profits or by selling its assets . Buyers sometimes raise the money by issuing junk bonds .

Example Sentences

The billionaire investor amassed a multimillion-dollar fortune by the 1980s through a number of leveraged buyouts financed by junk bonds sold by Michael Milken.

From Los Angeles Times

The detrimental effect of piling debt on a retailer in leveraged buyouts, like those for Payless, Toys "R" Us and Sears, have scared many private equity firms away from making such deals.

From New York Times

On the leveraged loan front, Morgan Stanley said it expects a return in loan issuance next year for M&A and leveraged buyouts, buoyed in part by anticipated Fed rate cuts.

From Reuters

More supply of new junk debt, including that backing recently announced leveraged buyouts, is expected to lift overall issuance volume of bonds and loans to $20 billion or more this month, said some investors.

From Reuters

A challenging financing market for leveraged buyouts amid high interest rates also weighed on the sale process.

From Reuters

Related Words

• hostile takeover
• takeover