leveraged buyout

American  

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

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leveraged buyout British  

/ ˈliːvərɪdʒd /

noun

1.  LBO.  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

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leveraged buyout Cultural  

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.

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Example Sentences

Private-equity managers emerged as big buyers of software companies in recent years, and private-debt funds increasingly backed those firm’s leveraged buyouts.

From The Wall Street Journal

Warner said this week that Paramount’s proposed $94 billion debt and equity financing package would make its proposed takeover of Warner the largest leveraged buyout ever.

From Los Angeles Times

Warner had said in its letter the Paramount offer is “in effect” a leveraged buyout, given the amount of debt involved and Paramount’s smaller size relative to Netflix.

From The Wall Street Journal

Discovery believes Paramount is effectively proposing a leveraged buyout, which introduces risks surrounding the ability and willingness of lenders to provide funds at close.

From The Wall Street Journal

Warner said the Paramount offer is “in effect” a leveraged buyout and would be the biggest such transaction in history.

From The Wall Street Journal

Related Words

• hostile takeover