Product details

By continuing to use our site you consent to the use of cookies as described in our privacy policy unless you have disabled them.
You can change your cookie settings at any time but parts of our site will not function correctly without them.
Management article
-
Reference no. 89607
Authors: John Kitching
Published by: Harvard Business Publishing
Published in: "Harvard Business Review", 1989

Abstract

Little reliable data is available on the structure and performance of leveraged buyouts. This statistical analysis of 320 deals in the United States and Great Britain offers some intriguing insights into the LBO phenomenon. For example, managers contribute only 3% of the cost of buyouts, but control 30% of the initial ownership; LBOs make impressive efficiency gains, but often fail to meet pre-buyout forecasts; and owners are cashing out more quickly than planned.

About

Abstract

Little reliable data is available on the structure and performance of leveraged buyouts. This statistical analysis of 320 deals in the United States and Great Britain offers some intriguing insights into the LBO phenomenon. For example, managers contribute only 3% of the cost of buyouts, but control 30% of the initial ownership; LBOs make impressive efficiency gains, but often fail to meet pre-buyout forecasts; and owners are cashing out more quickly than planned.

Related