leveraged-buyout-terms

Vocabulary Word

Definition

'Leveraged buyout terms' refer to the specifics around a leveraged buyout. This indicates how a massive amount of borrowed funds are used to purchase a company. Think of it in terms of purchasing a house; you don't pay the full amount right away, you get a loan (leverage) and pay over time.

Examples in Different Contexts

In deal structuring, 'leveraged buyout terms' are crafted to outline the specifics of the buyout agreement, such as equity stake, debt structure, and governance post-acquisition. A deal structurer might explain, 'The terms we've developed ensure that the leveraged buyout supports long-term growth and value creation for the acquired company.'

Practice Scenarios

Tech

Scenario:

Our software acquisition deals involve significant engagements. The buyout process needs to be structured efficiently to ensure a smooth transition.

Response:

I agree. We'll have to carefully review the leveraged buyout terms to prevent any technical disruption during the handover process.

Business

Scenario:

We're considering corporate buyout as a strategic move for our business. At the same time, we want to be clear about the details of financial agreement and commitments.

Response:

Excellent idea. I'll reach out to the finance team and start discussing preliminary leveraged buyout terms.