Category: What Is A Leveraged Buyout

The “Mini LBO” and the Five Things It Helps You Do

The “Mini LBO” or small leveraged buyout, can be done at any level with any company even though it is used so thoroughly by large investors and private equity firms. It is essentially a suite of financial techniques which enable the potential buyer of a company to leverage a small amount of money and combine it with conventional financing and seller financing to acquire a substantial company.

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What Henry Kravis, William Simon, Royal Little, Maybe Warren Buffett and You Have In Common

When someone talks to me about doing ten deals(and yes a subscriber mentioned it) – not just one but ten – it brings back fond memories. Indeed there was a time I wanted to do many more than ten deals becausof a couple of years starting with the IPO Gibson Greeting Cards and culminating in the billion dollar Pere I had just watched Wesray start from nothing (ok Simon had some money) and do a deal a month over the span mian Oil deal. KKR did a nice string of deals up until the RJR Nabisco Barbarians at the Gate deal, the largest of its day.

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Why do an LBO at all?

The rewards of doing an LBO are extraordinary. The prestige and financial power is intoxicating. Even the smallest of LBOs can generate huge income for a lifetime. If you follow internet marketing at all, you may be drawn to the...

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How Big is My LBO?

Size matters with LBO’s. The largest LBO market is comprised of target companies in excess of $1.0 Billion in sales. These are mostly public companies and as such command a different discipline than doing a deal on smaller private companies. This is a highly competitive market where deals are done by the largest of private equity groups or other large public companies.

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Leveraged Buyouts – The Beginning

I was a product of the Leveraged (LBO) craze in the eighties and nineties. That’s right, the big ones. When they just started. I was a young banker helping to finance Wesray, the celebrated pioneer of buyouts spearheaded by William Simon, former Treasury Sectretary and Ray Chambers back in 1982.

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