leveraged buy out

English - English

Definition of leveraged buy out in English English dictionary

A takeover financed to a large degree by debt that is secured, serviced and repaid through the cash flow and assets of the acquired company Typically, an LBO is financed predominantly by bank debt and low quality bonds, and to a minimum degree by equity Its extreme leverage makes an LBO dependent upon a stable economy and stable interest rates, as well as a stable cash flow from the acquired company for its success

A transaction used for taking a public corporation private, financed through the use of debt funds such as bank loans and bonds Because of the large amount of debt relative to equity in the new corporation, the bonds are typically rated below investment grade, properly referred to as high-yield or junk bonds Investors can participate in an LBO through either the purchase of the debt or the purchase of equity through an LBO fund that specializes in such investments

Acquisition of a controlling INTEREST in a company in a transaction financed by the issuance of DEBT instruments by the acquired entity

buying with a large amount of foreign capital

Alternative spelling of leveraged buyout

Turkish pronunciation

livırîcd bay aut

Pronunciation

/ˈlēvərəʤd ˈbī ˈout/ /ˈliːvɜrɪʤd ˈbaɪ ˈaʊt/