Leveraged buyouts: a smart strategy or a risky gamble?
The second episode in the Top of the Agenda series on private equity demystifies leveraged buyouts (LBOs); a widely used yet controversial private equity strategy. While LBOs can offer the potential for substantial returns by using debt to finance acquisitions, they also come with significant risks such as excessive debt burdens and aggressive cost-cutting measures.
Helen Jenkins and Tim Jenkinson, Oxera Partner and professor of finance at the University of Oxford’s Said Business School, explore the potential of LBOs to unlock value, rejuvenate companies, and drive growth while also addressing how they can negatively impact long-term business performance, sometimes leaving companies worse off.
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